Local Agency: County, city, city & county, including a chartered city or county, school district, community college district, public district, county board of education, county superintendent of schools, or any public or municipal corporation.
Local Agency Investment Fund (LAIF): The LAIF is an investment alternative for California's local government and special districts authorized under Sections 16429, 1, 2 and 3 of the California Government Code (the "Code"). The LAIF is managed by the State Treasurer's Office, with oversight by the Local Agency Investment Advisory Board. All securities in LAIF are purchased under the authority of Code Sections 16430 and 16480.4. The State Treasurer's Office receives all securities on a delivery versus payment basis using a third-party custodian. All securities are purchased at market, with market valuation conducted monthly.
Market Value: The price at which a security can be traded.
Master Repurchase Agreement: A written contract covering all future transactions between the parties to repurchase or reverse repurchase agreements that establishes each party's rights in the transactions. A master agreement will often specify, among other things, the right of the buyer- lender to liquidate the underlying securities in the event of default by the sellerborrower.
Maturity: The final date upon which the principal or stated value of a security becomes due and payable.
Medium Term Notes (MTN): Debt securities issued by a corporation or depository institution with a maturity ranging from nine months to five years. The term " medium-term notes" refers to the time it takes for an obligation to mature and includes other corporate debt securities originally issued for maturities longer than five years, but which have now fallen with the fiveyear maturity range. MTNs issued by banks are also called " bank notes." Item 8.4
Mountain House Page 670 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 293 Money Market: The market in which short-term debt instruments (Treasury Bills, discount notes, commercial paper, and banker' s acceptances) are issued and traded.
Mutual Funds: An investment company that pools money and can invest in a variety of securities , including fixed-income securities and money market instruments.
Nationally Recognized Statistical Rating Organization (NRSRO): Firms that review the creditworthiness of the issuers of debt securities, and express their opinion in the form of letter ratings (e.g. AAA, AA, A, BBB, etc.) The primary rating agencies include Standard & Poor's Corporation; Moody's Investor Services, Inc.; Fitch Investors Service; Duff & Phelps Investment Service; Thompson Bank Watch, and International Bank Credit Analyst.
Portfolio: A collection of securities held by an investor.
Price: The amount of monetary consideration required by a willing seller and a willing buyer to sell an investment on a particular date.
Prudent Investor Standard: A standard of responsibility which applies to fiduciaries. In California, the rule is stated as "Investments shall be managed with the care, skill, prudence and diligence, under the circumstances then prevailing, that a prudent person, acting in a like capacity and familiar with such matters, would use in the conduct of an enterprise of like character and with like aims to accomplish similar purposes." Principal: The face value or par value of an investment.
Rate of Return: The yield obtainable on a security based on its purchase price or its current market price. This may be the amortized yield to maturity on the bond or the current income return.
Rating: Various alphabetical and numerical designations used by institutional investors, Wall Street underwriters, and commercial rating companies use to give relative indications of bond and note creditworthiness.
Repurchase Agreement (RP or REPO): The purchase of securities, on a temporary basis, with the seller' s simultaneous agreement to repurchase the securities at a later date at a specified price that includes interest for the buyer's holding period. In essence, this is a collateralized investment whereby the security " buyer" lends the " seller" money for the period of the agreement.
Risk: The uncertainty of maintaining the principal or interest associated with an investment due to a variety of factors.
Item 8.4
Mountain House Page 671 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 294 Rule G-37 of the Municipal Securities Rulemaking Board: Federal regulations to sever any connection between the making of political contributions and the awarding of municipal securities business.
Safekeeping: A service to bank customers whereby securities are held for protection by the bank in the customer's name.
Safety: In the context of investing public funds, safety relates to the preservation of principal of an investment in an investment portfolio; local agencies address the concerns of safety by controlling exposure to risks.
Swap: A swap is any financial transaction that involves the simultaneous purchase of a security and the sale of another for the purpose of enhancing an investor's portfolio. Swap transactions of interest to California public investors include portfolio swaps and interest rate swaps.
Tax and Revenue Anticipation Notes (TRANs): Notes issued in anticipation of receiving tax proceeds or other revenues at a future date.
U.S. Government Agency Securities: Debt Securities issued by U.S. GSE and federally related institutions. These government agencies include: Federal Horne Loan Banks (FHLB); Federal Loan Mortgage Corporation (FHLMC, or "Freddie Mac"); Federal National Mortgage Association (FNMA or "Fannie Mae"); Federal Farm Credit Banks (FFCB); Farmer Mac.
Treasury Bills: Non-interest-bearing discount securities with maturities under one year issued by the U.S. Treasury to finance the national debt.
Treasury Notes: Interest-bearing obligations of the U.S. Treasury with maturities ranging from two to 10 years from date of issue.
Treasury Bonds: Interest-bearing obligations issued by the U.S. Treasury with maturities that range from 10 to 30 years from date of issue.
U.S. Treasury Securities: Securities issued by the U.S. Treasury and backed by the full faith and credit of the United States. Treasuries are considered to have no credit risk and are the benchmark for interest rates on all other securities in the U.S. and overseas. The U.S. Treasury issues both discounted securities and fixed coupon notes and bonds.
Weighted Average Maturity (WAM): The average maturity of all the securities that comprise a portfolio that is typically expressed in days or years.
Yield: The annual rate of return on a debt investment computed as though held to maturity expressed in percentages.
Zero-Coupon Bonds/U.S. Treasury Strips: A bond which represents ownership of a single coupon or principal payment due on a U.S. Treasury bond. “ eros” or “strips” mature at face Item 8.4
Mountain House Page 672 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 295 value at a specified date in the future and make no payments until that date. They always sell at a discount from face value.
SECTION 620: INVESTMENT POLICY FOR SPECIAL DEPOSITS
OVERVIEW
This Investment Policy for Special Deposits (the “Deposit Investment Policy”) was approved by the Mountain House Community Services District City Council on March 14, 2018. The Board reaffirmed this policy on June 12, 2019. The Deposit Investment Policy may be amended by the Board as it deems appropriate from time to time in the prudent investment of the City’s special deposits.
Policy Statement - The City is guided by three objectives in its investment of public funds. In order of priority those objectives are:
1.1. Safeguarding of principal.
1.2. Ensuring that investments satisfy the liquidity needs of the City.
1.3. Obtaining an optimal rate return on available assets, commensurate with an appropriate level of risk.
2. Scope - This investment policy applies to all special deposit funds not required for the immediate operating needs of the City and are accounted for in the City’s monthly financial report.
3. Objectives: The priority ranked objectives of the City’s investment activities shall be:
3.1. Legality. Investments shall only be made in securities legally permissible by the California Government Code, Sections 53635, 53635.2 et seq.
3.2. Safety. Investments shall be undertaken in a manner that seeks to ensure preservation of capital in the overall portfolio. To attain this objective, diversification is required. Investments must be made in securities of high quality to avoid credit risk and loss of principal.
3.3. Liquidity. The investment portfolio must remain sufficiently liquid to enable the City to meet all foreseeable operating requirements.
3.4. Return on Investment. The investment portfolio shall be designed with the objective of attaining a market rate of return, taking into consideration policy objectives and cash flow characteristics of the portfolio.
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4. Delegation of Authority - The City Council is responsible for the management and oversight of the investment program. Day to day management responsibility for the investment program is delegated to the City’s City Manager, who will ensure that the investment program is in accord with the Board’s directives. The City Manager shall be responsible for all transactions undertaken and will establish a system of controls to regulate the activities of appropriate staff members.
5. Prudence - Investments shall be made with time relevant judgment and care, which persons of prudence, discretion and intelligence exercise in the management of their own affairs, and not for speculation, but for investment, considering the probable safety of principal as well as the probable income to be derived. The standard of prudence to be used by investment officials shall be the “prudent person” standard and shall be applied in the context of managing an overall portfolio with aims to safeguard the principal and maintain the liquidity needs of the agency. The prudent investor standard states that when investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including but not limited to, the general economic conditions and the anticipated needs of the City, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims to safeguard the principal and maintain the liquidity needs of the City.
6. Borrowing for Purposes of Making Investments - Management is prohibited from the practice of borrowing for the sole purpose of making investments.
7. Authorized Investments and Limits - The City Manager or his/her designee may only invest funds in the following secure and reliable permitted investments:
7.1. Investment in the California Local Agency Investment Fund (LAIF). Funds shall be placed in LAIF as alternative liquid investments under this policy.
7.2. Shares of Beneficial Interest issued by diversified management companies, otherwise known as Mutual Funds, investing in the securities and obligations as authorized by the California Government Code, sections 53601 et seq.
7.3. United States Treasury Bills, Notes, Certificates of Indebtedness, or those for which the full faith and credit of the United States are pledged for the payment of principal and interest.
7.4. Savings Accounts or Certificates of Deposit issued by a nationally or state-chartered bank, or savings association fully insured by the FDIC or FSLIC.
7.5. Deposit of funds in the County of San Joaquin Treasury Investment Pool.
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7.6. U.S. Federal Agency or United States government-sponsored enterprise obligations, participations or other instruments issued by the Government National Mortgage Association (GNMA), the Federal Home Loan Bank (FHLB), the Federal National Mortgage Association (FNMA), the Federal Home Loan Mortgage Association (FHLMC), the Federal Farm Credit System (FFCB), and the Federal Agricultural Mortgage Company/Farmer Mac (FAMCA).
7.7. Medium Term Corporate Notes, defined as all corporate and depository institution debt securities with a maximum remaining maturity of five years or less, issued by corporations organized and operating within the United States or by depository institutions licensed by the United States or any state operating within the United States. otes eligible for investments under this subdivision shall be rated “A” or better by a nationally recognized rating service.
8. Maximum Maturities - To the extent possible, investments shall be made to match anticipated cash flow requirements. Furthermore, no investment with a term in excess of five years may be made.
9. Internal Control - As part of the City’s annual independent audit, the investment program shall be reviewed for appropriate internal controls that provide assurance of compliance with policies and procedures.
10. Reporting - The City Manager shall provide the City Council with a quarterly report of investment activity verifying that the investment portfolio is in compliance with the City’s investment policy. The report will also include a statement indicating the City’s ability to meet its expenditure requirements for the ensuing six months or to provide an explanation as to why sufficient funds shall not or will not be available.
11. Ethics and Conflicts of Interest – Officers and employees involved in the investment process shall refrain from personal business activities that could conflict with proper execution of the investment program, or which could impair their ability to make impartial decisions.
12. Investment Policy Review - The City Council shall review the investment policy annually.
The Board shall accept and approve the investment policy and any changes.
Item 8.4
Mountain House Page 675 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 298 SECTION 630: BANK, INVESTMENT, AND COUNTY TREASURY RECONCILIATION Objectives
The objectives of this bank and treasury reconciliation policy are as follows:
• Ensure the City’s books are kept with reasonably current balances for all cash and investment accounts owned by the City with reconciliations completed monthly by the end of each month for the preceding month. • Promptly identify and resolve errors made either by the bank, County Treasury, or investment custodian or errors made on the City’s books. • Promptly identify and resolve unauthorized activity occurring in the City’s accounts.
Segregation of Duties
Best practices in internal control assign the responsibility for reconciling a bank account to an individual who neither has the authority to authorize disbursement from the account nor makes entries in the accounting system impacting the account. The ability to fully segregate this function depends on staffing level and cost-benefit considerations. The Finance Department will consider these best practices as well as the City’s business needs when assigning an individual to the bank reconciliation function.
County Treasury
The combined balance of cash and investments in the San Joaquin County EFS system in all funds beginning with 478 will be reconciled on a monthly basis to the City’s general ledger balances in the 1111 object accounts using the pooled cash report defined for this purpose. The following describes the detailed procedure to be followed.
1. By the 15th day of each month, the Finance Department personnel responsible for reconciling the County Treasury pooled cash account will obtain the County Treasury balance from the San Joaquin County EFS system and pull a pooled cash report from the Tyler Incode 10 system for the end of the previous month.
2. The reconciler will compare the activity posted between the City’s general ledger system and the County, listing the exact amount of each item causing a difference. The reconciler will compare vendor names in the County system to the names posted in the City’s general ledger system. The reconciler may write off trivial amounts that are not worth the time it would take to research. The reconciler may employ any or all of the following procedures to identify the difference:
a. Verifying that all County-initiated journal entries (“SSTs”) and property tax revenues posted by the County have been posted to the City’s GL as well. b. Verifying that all utility refund batches sent to the County for payment have been recorded in the GL for the month.
Item 8.4
Mountain House Page 676 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 299 c. Determining whether any accounts payable check batches or deposits sent to the County for processing and posted to the City GL near the end of the previous month were not posted by the County to the EFS until after the end of the month.
d. Comparing detailed transaction lists from the City GL and the County EFS and marking off items that are accounted for in both lists to identify the items that are different.
e. Re-running the pooled cash report for the last month that had previously been reconciled and comparing it to the report that was originally used when that reconciliation was done to determine if a back-posting to a previous month in the GL may have occurred.
3. After identifying any differences, the reconciler will complete the reconciliation by submitting the following documents for review to a reviewer who is not typically involved in executing or routinely reviewing the day-to-day cash receipting or disbursing processes, such as the Administrative Services Director or Finance Director:
a. County EFS printout showing the balance in the County Treasury at the end of the previous month
b. Tyler Pooled Cash Report as of the previous month end c. Listing of any differences between the two
d. Supporting documentation for any significant differences that will carry forward into the following month
4. After reviewing the bank reconciliation and supporting documents and determining that any differences appear appropriate, the reviewer will initial or otherwise indicate review of the bank reconciliation packet, which will then be filed.
Utility Payment Lockbox
On a monthly basis by the 15th day of each month, the Finance Department will reconcile the utility payment lockbox account for the previous month according to the following procedure:
1. First, the deposits and withdrawals from the Utility Payment Lockbox account will be reconciled to the AVR reports as follows.
a. Using a template designed for these purposes, the Finance Department will recompute the ending balance in the lockbox account using the total payments received reported in the utility billing system. This will ensure that if the total payments received in the lockbox do not match the payments received in the billing system, the difference will be identified. b. The reconciliation will account for the differences identified, including the following common differences:
Item 8.4
Mountain House Page 677 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 300 i. Timing differences such as payments included in the utility billing system in a different month from the month they are deposited into lockbox bank account.
ii. The receipt of customer deposits and overpaid amounts in the current month in the lockbox account that will not be applied to a customer account until a future month.
iii. The application of customer deposits and prior month overpayments to customer accounts which result in a reduction to the customer account balance in the current month for payments that may have been posted to the lockbox account in previous months.
iv. Merchant processing fees, bank service charges, and other fees deducted from the bank account but not accounted for in the utility billing system.
v. Refunds on closed accounts that may be treated as a negative payment in the billing system even though the refund payment is not actually made from the lockbox account and therefore does not impact the lockbox bank balance.
2. After reconciling the activity in the lockbox bank account to the utility billing system, the Finance Department will post the monthly journal entry to record the utility billing activity in the subsidiary system. The entry will be designed to eliminate timing differences in the ending account balance by distributing those differences out to revenue accounts and then reversing them in the following month.
3. After the posting of the utility billing journal entry for the month, the Finance Department staff will verify that the total balance in the 1116 Cash in Lockbox account in the General Ledger matches the ending balance in the lockbox bank account.
Other Bank Accounts
For any other bank or investment accounts, the Finance Department will compare the statement balances to the General Ledger on a monthly basis and make the appropriate adjustments by the end of the following month. The reconciling items for other bank accounts will be typically minimal.
Item 8.4
Mountain House Page 678 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 301 SECTION 640: IMPREST CASH CHECKING ACCOUNT POLICY
OVERVIEW
Mountain House Community Services District’s offices and facilities are located approximately 27 miles from the San Joaquin County Treasurer’s Office in Stockton. Because the San Joaquin County Treasurer serves as the City’s treasurer pursuant to Government Code Section 61052, the City is required to transport checks for deposit to the County Treasury and to obtain warrants drawn on the County Treasury to pay the City’s obligations. The physical distance between the two locations makes frequent deposits, a best practice in internal control, more challenging. The City currently utilizes desktop deposit technology to scan and deposit incoming checks at the City for incoming customer utility payments, which are deposited to a designated account, and would like to implement similar desktop deposit technology for non-utility payments as well to facilitate faster clearing of incoming funds. The City also has recurring bills with a short window of time to make payment and is left with an extremely short turn-around time to submit these bills to the County for processing to ensure the payments are disbursed timely and penalties avoided.
Government Code Section 53952(b) permits the City to establish a revolving fund in an amount not to exceed one hundred and ten percent (110%) of one twelfth (1/12) of the City’s adopted budget for the current fiscal year.
Deposit of Incoming Payments to Imprest/Revolving Account For all incoming check payments that are not utility payments, amounts and payment details will be logged on the City’s incoming revenue log. The incoming checks and any supporting documentation will be placed in a secured container in the Accounting Manager’s office. Key access will be limited to the Accounting Manager and Finance Director. The City will then deposit all incoming checks to its imprest/revolving account, preferably using desktop deposit technology where the checks are scanned and deposited right in the City’s Office. The imprest account is currently at Wells Fargo Bank; District staff will not have ability to add accounts to the desktop technology. The bank will control access to the system with usernames and passwords.
A Finance Department staff member will compare the incoming revenue log total with the total deposited by desktop deposit. After resolving any differences, the Finance Department staff member will post a deposit to the Incode General Ledger system 1112 imprest/revolving account.
All incoming checks subject to this policy should be deposited to the imprest/revolving account within two (2) business days of receipt. Checks that have been deposited successfully through desktop deposit should be bundled by deposit date and maintained in a secure location. If the Item 8.4
Mountain House Page 679 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 302 original checks are not requested by the bank within thirty (30) days of the desktop deposit, they should be destroyed.
If the City receives a check that cannot be scanned using the desktop technology, the maker will be requested to provide a replacement and the original payment will be stored in the secure container until a replacement is successfully deposited. The original payment will then be voided and returned to the maker.
Maximum Balance and Deposit of Excess to County Treasury The City intends to maintain no more than three-hundred thousand dollars ($300,000) in the imprest/revolving account on an ongoing basis. When the balance exceeds this amount continuously for more than two (2) weeks, a Finance Department staff member will prepare a check payable to the County Treasury and deposit the excess funds in the County Treasury.
Allowable Uses of Funds from Imprest/Revolving Account
Other than flowing into the County Treasury, the funds in the imprest/revolving account will be used sparingly in the discretion of the Finance Department and in any event may only be used to pay for lawful expenses or obligations of the City that meet both of the following two criteria:
• The expense or obligation is currently or routinely required to be paid within a short time period that creates uncertainty as to whether it will be processed timely if payment is made through the County Treasury OR is five hundred dollars ($500) or less, AND;
• The payment is to a payee who is exempt from IRS form 1099 reporting (e.g. a governmental entity or corporation) or is of a nature that is exempt from 1099 reporting by reason other than dollar amount (e.g. accountable plan reimbursement to an employee, which would never be subject to 1099 reporting regardless of dollar amount). Payments that would be subject to 1099 reporting but for the fact that they fall below six hundred dollars ($600) are not permitted, because of the potential for multiple payments to occur within one year. • Examples of allowable uses are (this list is not all-inclusive):
• Electric utility bills paid to a government agency exempt from 1099 reporting where there is a short time before payment is due
• Payment of State Disability Insurance taxes where there is a short time before payment is due
Signature Authority
Checks drawn on the imprest/revolving account may be signed by any of the following:
• Administrative Services Director
• Finance Director
Item 8.4
Mountain House Page 680 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 303 • Assistant Finance Director
• Accounting Manager
Signers of checks drawn on the imprest/revolving account will review backup documentation and ensure the proposed disbursement is consistent with this policy prior to signing any checks.
Disbursement Procedure
• The imprest/revolving account will be set up as a Cash in Other Banks account (GL object 1112) in the Tyler Incode General Ledger system. All disbursements from the imprest/revolving account will be prepared using the Incode General Ledger system.
• Check stock for the imprest account will be stored in a locked safe. • One of the authorized signers noted above may designate a list of obligations that will routinely be paid from the imprest/revolving account. Any transaction not so designated must be approved for use of this procedure prior to preparation of the check.
• Where feasible, a Finance Department staff member other than an authorized signer should prepare all checks for disbursement from the imprest/revolving account after reviewing appropriate backup documentation. • Backup documentation supporting the transaction should be attached to the vendor invoice within Incode.
• Checks and supporting documentation will be presented to an authorized signer for a physical (wet) signature. No signature stamps, check signing machines, or signature images will be permitted.
• After the check is signed, the Finance Department staff member preparing the check will distribute it to the appropriate party.
Bank Reconciliation
The imprest/revolving account will be reconciled to the Incode general ledger account on a monthly basis by the end of the month following the month being reconciled. A Finance Department staff member who is not involved in the disbursement process should reconcile the account using the following procedure:
1. Obtain the bank statement directly from the bank online or unopened in the incoming mail.
2. Compare the transactions on the bank statement to transactions recorded in the 1112 General Ledger account for the imprest/revolving account.
3. Inspect copies of checks clearing the account to determine the check vendor on the check appears consistent with the vendor shown in Incode for that check.
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4. Prepare and sign a reconciliation report identifying all differences (such as individual outstanding checks) between the bank statement balance and the General Ledger balance.
5. If the balance in the account has exceeded $300,000 for two consecutive weeks, recommend that a check be written to deposit excess funds in the County Treasury.
Submit the reconciliation report on a rotating basis for review to each of the authorized signers on the imprest/revolving account.
SECTION 710: UTILITY BILLING AND PAYMENTS
New Service
Inframark Customer Care department will process all requests to establish service. Homeowner may email or fax completed service order along proof of ownership to Inframark. Inframark will set up in AVR billing system. Inframark sends a log each night to MHCSD and Inframark Field Reps of all new accounts.
Final Account (Close Account)
Inframark Customer Care department will process all requests to stop service. Homeowner may email or fax required documents to Inframark Customer Care department. Inframark sends a log each night to MHCSD and Inframark Field Reps of all discontinued accounts.
Monthly Billing and Payments
Inframark processes all monthly billing using the AVR program. Payment options are as follows:
• Mail to: MHCSD – PO Box 684000, Houston, TX 77268
• In person (check, cashier’s check, money order): MHCSD – 251 E. Main Street, Mountain House CA 95391
• Drop Box (check, cashier’s check, money order) at MHCSD office – Box is emptied at 4:30 pm (PST)
• Online at www.mountainhousecsd.org
• Pay by phone (800) 441-4501
• Scan to Pay on the bottom of your bill
• Automatic Bank Draft – Call 855-327-0900 for information Payments mailed to the Houston address and all electronic payments are processed by AVR and deposited to the MHCSD Lockbox Wells Fargo Bank account.
A Customer Service Representative will process payments made at MHCSD into the AVR system. The Customer Service Representative then gives the checks to the Accountant I who scans the checks and performs a desktop deposit to deposit the funds to the Wells Fargo Lockbox account.
Item 8.4
Mountain House Page 682 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 305 Delinquent Notices
Inframark will calculate and process delinquent notices for all accounts that have not paid by the due date. Inframark will then mail notices to each customer. 48-hour door tags
Inframark will calculate the 48-hour door tag file. They will then send the file to MHCSD.
MHCSD will print the tags. An Inframark field representative will hang the tags on the property.
Disconnect for non-payment
Inframark will calculate the disconnect list/file. They will then send it to MHCSD for approval.
MHCSD Customer Service Rep will review each account. CS Rep will review recent notes and payments along with any possible order to close account due to sale. Upon approval, Inframark will then add fees to account ($100.00 Cut-Off Charge + $300 Deposit). MHCSD will print the tags. An Inframark field representative will hang the tags on the property and disconnect the service.
Customer must call Inframark Customer Care Department with confirmation number after making payment. The Customer Care Department will confirm payment and generate an order to have service restored.
Liens
MHCSD Customer Service Representative will run a Collection Accounts Detail Listing for all accounts with a delinquent balance of $500.00 (amount subject to change) at the beginning of each month. Representative will review each account status, recent notes, payments, amortization plans and check to see if the account holder is an owner or tenant.
CS Representative will mail Lien Notification letters to the owner of each property by certified mail. CS Supervisor will add $100.00 lien fee to the account. CS Representative will log account information on the Lien Tracking spreadsheet and on the account. The owner will have 10 days from the date of the letter to appeal. CS Supervisor will notify Tracy Press (via email) to run lien publication 10 days prior to Board Meeting. CS Supervisor will submit a listing of unpaid accounts to the Administrative Services Director to be included on the Staff Report. City Council will review and approve for lien or give further collection instructions. City Manager and Secretary to the Board will sign & notarize documents. CS Representative will send documents to San Joaquin County for recording. CS Supervisor will review all unpaid liens and roll them over to the County tax roll in August. CS Representative will have the lien amount written off in AVR by Inframark.
Collection on Closed Accounts
CS Supervisor will run a Collection Accounts Detail Listing each month and review accounts that are delinquent for 30+ days. Supervisor will review owner information, payment information, account notes and new account holder. If the account holder was a tenant, the unpaid balance Item 8.4
Mountain House Page 683 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 306 will be transferred to the owner’s account. If the property has been sold and is currently in a new owner’s name then the unpaid balance will be sent to collections. CS Supervisor will log account information on a spreadsheet and email to Inframark in order to have the money transferred or sent to Collections Unlimited.
Reconciliation
At the end of each month, the Accountant I downloads the bank statement for the Wells Fargo Lockbox account. S/he also receives a “Daily Cash Sheet” or “Batch Sheet” for the month that summarizes all of the payments processed in AVR for the previous billing cycle via e-mail from an Inframark representative. The report lists payments by date and payment type only, but the totals agree to the AVR reports for the previous billing cycle. Using these two reports, s/he determines the transactions that posted to either the bank account or AVR but not both and completes a reconciliation identifying the reconciling differences between the two. After adjusting for outstanding items, the balance in the Wells Fargo Lockbox account should agree to the ending balance of undistributed overpayments per the AVR End of Month Recap, since the undistributed overpayments should be retained in the lockbox account until they are ultimately distributed to the various categories of collections (i.e. garbage, water operating, water
ETHICAL STANDARDS OF CONDUCT
The purpose of this policy is to set forth the ethical standards of professional behavior expected of all officials and employees conducting purchasing activities on behalf of the City.
Standards of Conduct
Every employee or official engaging in purchasing activities on behalf of the City is required to employ the following standards of conduct:
- Consider, first, the interests of the City in all transactions. - Carry-out the established policies of the City.
- Buy without prejudice, seeking to obtain the maximum value for each expenditure of public funds.
- Subscribe to and work for honesty and truth in buying and selling, and to denounce all forms and manifestations of commercial bribery.
- Cooperate with all organizations and individuals engaged in activities designed to enhance the development of purchasing practices.
- Respect obligations to others and require the same respect from others for their obligations.
Item 8.4
Mountain House Page 684 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 307 Prohibited Practices
The following practices are specifically prohibited in performing purchasing activities on behalf of the City:
- Having a financial or personal beneficial interest (directly or indirectly) in any contract or purchase order for supplies, equipment, services, or projects furnished to the City. - Accepting or receiving (directly or indirectly) from any person, firm, or corporation to whom any contract or purchase order may be awarded (by rebate, gift or otherwise) any money or anything of value, or any promise, obligation or contract for future reward or compensation. Inexpensive advertising items bearing the name of the firm—such as pens, pencils, paper weights or calendars—are not considered articles of value or gifts in relation to this policy.
- Using information available to officials and employees, solely because of their District position, for personal profit, gain or advantage.
- Directly or indirectly furnishing services or information not available to all prospective bidders to any person or firm bidding on, or who may reasonably be expected to bid on, a contract with the City.
- Providing confidential information to persons to whom issuance of such information has not been authorized.
- Using a position or status in the City to solicit (directly or indirectly) business of any kind; or to purchase products at special discounts or upon special concessions for personal private use from any person or firm who sells or solicits sales to the City. - Serving the interests of any organization (either as an officer, employee, member of the City Council , or in any capacity for consideration) which transacts or attempts to transact business with the City for profit when such employee holds a District position of review or control—even though remote—over such business transactions.
Responsibility
Employees:
- Each employee is responsible for following these practices. Violation of this policy may result in disciplinary action, termination of employment or criminal prosecution.
Department Managers:
- Department managers are responsible for ensuring that all employees of their department who conduct purchasing activities possess a thorough understanding of these standards of ethical conduct and prohibited practices.
Item 8.4
Mountain House Page 685 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 308
POOLED CASH
The purpose of these guidelines is to set forth standards, responsibilities and procedures for the prudent investment of pooled cash and cash held by fiscal agents.
Except for amounts held by fiscal agents in accordance with bond ordinances, the Master Acquisition and Reimbursement Agreement, and other special deposits as approved by the City Council , all of the City’s cash is deposited in the San Joaquin County Treasury. The County maintains a cash and investment pool that is available to all for funds for which the County Treasury is the depository, for the purpose of increasing interest earnings through investment activities. Funds held in the County’s investment pool are invested in accordance with the County’s Investment Policy, which is presented below. The “O TSIDE AGE CIES” section of the County’s policy provides that all agencies placing funds in the County pool must comply with the County’s investment policy.
INTERFUND LOAN POLICY
This policy documents requirements and responsibilities to be followed regarding borrowing between funds of the Mountain House Community Services District.
The purpose of this policy is to ensure that all interfund loans are appropriate, properly documented, and not established to the detriment of the fund issuing the loan.
POLICY
Interfund loan recommendations and agreements must include the loan amount, an identified repayment source and the date or timing of repayment.
The agreements may include an interest component that equals the investment earnings the fund would have received had the loan not occurred, with the following exceptions:
- Amounts loaned from the Water, Wastewater and Stormwater funds to other District funds must include an interest component.
- Amounts loaned to Developer funds must include an interest component.
When it is determined that interest will be paid by the borrowing fund to the lending fund, the amount of interest to be charged will be calculated using the rate investment rate earned by the San Joaquin County Treasury.
The City Council must approve by resolution all interfund loans.
Payments made on outstanding loans shall be reflected in the proposed and adopted operating budget and in the annual financial statements. The annual financial statements will also include Item 8.4
Mountain House Page 686 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 309 the loan amount, term, rate of interest, and amount of interest due on the total amount of the loan.
Interfund loan agreements will be reviewed and approved by the Board annually.
DEFINITION
Interfund loans are loans from one District fund to another District fund for a designated purpose.
Interfund loans may be made for the following reasons:
- To offset timing differences in cash flow
- To provide financing for interim financing in conjunction with obtaining long-term financing
- For short-term borrowing in place of external financing - To provide operating capital for utility funds while the customer base increases - For other needs as deemed appropriate by the City Council Interfund loan monies may only be used for the purpose identified in the authorizing resolution. Records of interfund loan transactions will be maintained in accordance with generally accepted accounting principles and will reflect the balances of loans in every fund affected by such transactions.
DEBT MANAGEMENT POLICY
This Debt Management Policy (the “Debt Policy”) was approved by the Mountain House Community Services District City Council on February 14, 2018. The Debt Policy may be amended by the Board as it deems appropriate from time to time in the prudent management of the City’s debt.
This Debt Policy is intended to comply with Government Code Section 8855(i), effective on January 1, 2017, and shall govern all debt undertaken by the City.
The City hereby recognizes that a fiscally prudent debt policy is required in order to:
- Maintain the City’s sound financial position.
- Ensure the City has the flexibility to respond to changes in future service priorities, revenue levels, and operating expenses.
- Protect the City’s creditworthiness.
Item 8.4
Mountain House Page 687 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 310 - Ensure that all debt is structured in order to protect both current and future taxpayers, ratepayers and constituents of the City.
- Ensure that the City’s debt is consistent with its planning goals and objectives and capital improvement program or budget, as applicable.
Purposes for Which Debt May Be Issued
Long-Term Debt
Long-term debt may be issued to finance the construction, acquisition, and rehabilitation of capital improvements and facilities, equipment and land to be owned and operated by the City. - Long-term debt financings are appropriate when the following conditions exist:
o When the project to be financed is necessary to provide basic services. o When the project to be financed will provide benefit to constituents over multiple years.
o When total debt does not constitute an unreasonable burden to the City and its taxpayers and ratepayers.
o When the debt is used to refinance outstanding debt in order to produce debt service savings or to realize the benefits of a debt restructuring. - Long-term debt financings will not generally be considered appropriate for current operating expenses and routine maintenance expenses.
- The City may use long-term debt financings subject to the following conditions:
o The project to be financed must be approved by the City Council . o The weighted average maturity of the debt (or the portion of the debt allocated to the project) will not exceed the average useful life of the project to be financed by more than 20%.
o The City estimates that sufficient revenues will be available to service the debt through its maturity.
o The City determines that the issuance of the debt will comply with the applicable state and federal law.
Short-term debt
Short-term debt may be issued to provide financing for the City’s operational cash flows in order to maintain a steady and even cash flow balance. Short-term debt may also be used to Item 8.4
Mountain House Page 688 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 311 finance short-lived capital projects; for example, the City may undertake lease-purchase financing for equipment.
Types of Debt
The following types of debt are allowable under this Debt Policy:
- General obligation bonds
- Bond or grant anticipation notes
- Lease revenue bonds, certificates of participation and lease-purchase transactions - Other revenue bonds and certificates of participation - Tax and revenue anticipation notes
- Land-secured financings, such as special tax revenue bonds issued under the Mello-Roos Community Facilities Act of 1982, as amended, and limited obligation bonds issued under applicable assessment statutes
- Tax increment financing to the extent permitted under state law - Conduit financings, such as financings for affordable rental housing and qualified 501c3 organizations
The City may from time to time find that other forms of debt would be beneficial to further its public purposes and may approve such debt without an amendment of this Debt Policy.
Debt shall be issued as fixed rate debt unless the City makes a specific determination as to why a variable rate issue would be beneficial to the Issuer in a specific circumstance.
Relationship of Debt to Capital Improvement Program and Budget The City is committed to long-term capital planning. The City intends to issue debt for the purposes stated in this Debt Policy and to implement policy decisions incorporated in the City’s capital budget and the capital improvement plan.
The City shall strive to fund the upkeep and maintenance of its infrastructure and facilities due to normal wear and tear through the expenditure of available operating revenues. The City shall seek to avoid the use of debt to fund infrastructure and facilities improvements that are the result of normal wear and tear.
The City shall integrate its debt issuances with the goals of its capital improvement program by timing the issuance of debt to ensure that projects are available when needed in furtherance of the City’s public purposes.
Item 8.4
Mountain House Page 689 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 312 The City shall seek to avoid the use of debt to fund infrastructure and facilities improvements in circumstances when the sole purpose of such debt financing is to reduce annual budgetary expenditures.
The City shall seek to issue debt in a timely manner to avoid having to make unplanned expenditures for capital improvements or equipment from its general fund.
Policy Goals Related to Planning Goals and Objectives
The City is committed to long-term financial planning, maintaining appropriate reserves levels, and employing prudent practices in governance, management and budget administration. The City intends to issue debt for the purposes stated in this Policy and to implement policy decisions incorporated in the City’s annual operations budget.
It is a policy goal of the City to protect taxpayers, ratepayers and constituents by utilizing conservative financing methods and techniques so as to obtain the highest practical credit ratings (if applicable) and the lowest practical borrowing costs.
The City will comply with applicable state and federal law as it pertains to the maximum term of debt and the procedures for levying and imposing any related taxes, assessments, rates and charges.
When refinancing debt, it shall be the policy goal of the City to realize, whenever possible, and subject to any overriding non-financial policy considerations - Minimum net present value debt service savings equal to or greater than 3.0% of the refunded principal amount, and
- Present value debt service savings equal to or greater than 100% of any escrow fund negative arbitrage.
Internal Control Procedures
When issuing debt, in addition to complying with the terms of this Debt Policy, the City shall comply with any other applicable policies regarding initial bond disclosure, continuing disclosure, post-issuance compliance, and investment of bond proceeds.
The City will periodically review the requirements of and will remain in compliance with the following:
- Any continuing disclosure undertakings under SEC Rule 15c2-12, - Any federal tax compliance requirements, including without limitation arbitrage and rebate compliance, related to any prior bond issues, and - The City’s investment policies as they relate to the investment of bond proceeds.
Item 8.4
Mountain House Page 690 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 313 Whenever reasonably possible, proceeds of debt will be held by a third-party trustee and the City will submit written requisitions for such proceeds. The Issuer will submit a requisition only after obtaining the signature of the City Manager or his/her designee.
Item 8.4
Mountain House Page 691 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 314 Debt Schedules
Date Principal Interest Total Balance
16,805,000.00
6/1/20 - 269,696.23 269,696.23 16,805,000.00
12/1/20 535,000.00 307,248.88 842,248.88 16,270,000.00
6/1/21 - 301,053.58 301,053.58 16,270,000.00
12/1/21 510,000.00 301,053.58 811,053.58 15,760,000.00
6/1/22 - 294,637.78 294,637.78 15,760,000.00
12/1/22 520,000.00 294,637.78 814,637.78 15,240,000.00
6/1/23 - 287,630.78 287,630.78 15,240,000.00
12/1/23 540,000.00 287,630.78 827,630.78 14,700,000.00
6/1/24 - 279,978.98 279,978.98 14,700,000.00
12/1/24 555,000.00 279,978.98 834,978.98 14,145,000.00
6/1/25 - 271,698.38 271,698.38 14,145,000.00
12/1/25 570,000.00 271,698.38 841,698.38 13,575,000.00
6/1/26 - 262,547.03 262,547.03 13,575,000.00
12/1/26 590,000.00 262,547.03 852,547.03 12,985,000.00
6/1/27 - 252,484.58 252,484.58 12,985,000.00
12/1/27 610,000.00 252,484.58 862,484.58 12,375,000.00
6/1/28 - 241,593.03 241,593.03 12,375,000.00
12/1/28 635,000.00 241,593.03 876,593.03 11,740,000.00
6/1/29 - 227,412.50 227,412.50 11,740,000.00
12/1/29 665,000.00 227,412.50 892,412.50 11,075,000.00
6/1/30 - 210,787.50 210,787.50 11,075,000.00
12/1/30 705,000.00 210,787.50 915,787.50 10,370,000.00
6/1/31 - 193,162.50 193,162.50 10,370,000.00
12/1/31 740,000.00 193,162.50 933,162.50 9,630,000.00
6/1/32 - 174,662.50 174,662.50 9,630,000.00
12/1/32 785,000.00 174,662.50 959,662.50 8,845,000.00
6/1/33 - 155,037.50 155,037.50 8,845,000.00
12/1/33 825,000.00 155,037.50 980,037.50 8,020,000.00
6/1/34 - 134,412.50 134,412.50 8,020,000.00
12/1/34 875,000.00 134,412.50 1,009,412.50 7,145,000.00 6/1/35 - 112,537.50 112,537.50 7,145,000.00
12/1/35 920,000.00 112,537.50 1,032,537.50 6,225,000.00 6/1/36 - 98,737.50 98,737.50 6,225,000.00
12/1/36 950,000.00 98,737.50 1,048,737.50 5,275,000.00
6/1/37 - 84,487.50 84,487.50 5,275,000.00
12/1/37 985,000.00 84,487.50 1,069,487.50 4,290,000.00
6/1/38 - 69,712.50 69,712.50 4,290,000.00
12/1/38 1,015,000.00 69,712.50 1,084,712.50 3,275,000.00 6/1/39 - 53,218.75 53,218.75 3,275,000.00
12/1/39 1,055,000.00 53,218.75 1,108,218.75 2,220,000.00 6/1/40 - 36,075.00 36,075.00 2,220,000.00
12/1/40 1,090,000.00 36,075.00 1,126,075.00 1,130,000.00 6/1/41 - 18,362.50 18,362.50 1,130,000.00
12/1/41 1,130,000.00 18,362.50 1,148,362.50 -
Totals 16,805,000.00 8,097,405.89 24,902,405.89
Schedule of 2019 Payments
(2007 Project, 2011 Project and 2019 Project)
Principal Amount: $16,805,000
Water System
Item 8.4
Mountain House Page 692 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 315 Date Principal Interest Total Payment Balance
12,770,000.00
6/1/20 - 209,131.32 209,131.32 12,770,000.00
12/1/20 400,000.00 238,250.88 638,250.88 12,370,000.00
6/1/21 - 233,618.88 233,618.88 12,370,000.00
12/1/21 380,000.00 233,618.88 613,618.88 11,990,000.00
6/1/22 - 228,838.48 228,838.48 11,990,000.00
12/1/22 390,000.00 228,838.48 618,838.48 11,600,000.00
6/1/23 - 223,583.23 223,583.23 11,600,000.00
12/1/23 405,000.00 223,583.23 628,583.23 11,195,000.00
6/1/24 - 217,844.38 217,844.38 11,195,000.00
12/1/24 415,000.00 217,844.38 632,844.38 10,780,000.00
6/1/25 - 211,652.58 211,652.58 10,780,000.00
12/1/25 425,000.00 211,652.58 636,652.58 10,355,000.00
6/1/26 - 204,829.20 204,829.20 10,355,000.00
12/1/26 440,000.00 204,829.20 644,829.20 9,915,000.00
6/1/27 - 197,325.00 197,325.00 9,915,000.00
12/1/27 460,000.00 197,325.00 657,325.00 9,455,000.00
6/1/28 - 185,825.00 185,825.00 9,455,000.00
12/1/28 480,000.00 185,825.00 665,825.00 8,975,000.00
6/1/29 - 173,825.00 173,825.00 8,975,000.00
12/1/29 510,000.00 173,825.00 683,825.00 8,465,000.00
6/1/30 - 161,075.00 161,075.00 8,465,000.00
12/1/30 540,000.00 161,075.00 701,075.00 7,925,000.00
6/1/31 - 147,575.00 147,575.00 7,925,000.00
12/1/31 565,000.00 147,575.00 712,575.00 7,360,000.00
6/1/32 - 133,450.00 133,450.00 7,360,000.00
12/1/32 600,000.00 133,450.00 733,450.00 6,760,000.00
6/1/33 - 118,450.00 118,450.00 6,760,000.00
12/1/33 630,000.00 118,450.00 748,450.00 6,130,000.00
6/1/34 - 102,700.00 102,700.00 6,130,000.00
12/1/34 665,000.00 102,700.00 767,700.00 5,465,000.00
6/1/35 - 86,075.00 86,075.00 5,465,000.00
12/1/35 705,000.00 86,075.00 791,075.00 4,760,000.00
6/1/36 - 75,500.00 75,500.00 4,760,000.00
12/1/36 730,000.00 75,500.00 805,500.00 4,030,000.00
6/1/37 - 64,550.00 64,550.00 4,030,000.00
12/1/37 750,000.00 64,550.00 814,550.00 3,280,000.00
6/1/38 - 53,300.00 53,300.00 3,280,000.00
12/1/38 775,000.00 53,300.00 828,300.00 2,505,000.00
6/1/39 - 40,706.25 40,706.25 2,505,000.00
12/1/39 805,000.00 40,706.25 845,706.25 1,700,000.00
6/1/40 - 27,625.00 27,625.00 1,700,000.00
12/1/40 835,000.00 27,625.00 862,625.00 865,000.00
6/1/41 - 14,056.25 14,056.25 865,000.00
12/1/41 865,000.00 14,056.25 879,056.25 -
Totals 12,770,000.00 6,252,190.70 19,022,190.70
Schedule of 2019 Payments
(2007 Project, 2011 Project and 2019 Project)
Principal Amount: $12,770,000
Wastewater System
Item 8.4
Mountain House Page 693 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 316 Date Principal Interest Total Balance
4,115,000.00
6/1/20 - 67,083.95 67,083.95 4,115,000.00
12/1/20 130,000.00 76,424.75 206,424.75 3,985,000.00
6/1/21 - 74,919.35 74,919.35 3,985,000.00
12/1/21 125,000.00 74,919.35 199,919.35 3,860,000.00
6/1/22 - 73,346.85 73,346.85 3,860,000.00
12/1/22 125,000.00 73,346.85 198,346.85 3,735,000.00
6/1/23 - 71,662.48 71,662.48 3,735,000.00
12/1/23 135,000.00 71,662.48 206,662.48 3,600,000.00
6/1/24 - 69,749.53 69,749.53 3,600,000.00
12/1/24 135,000.00 69,749.53 204,749.53 3,465,000.00
6/1/25 - 67,735.33 67,735.33 3,465,000.00
12/1/25 140,000.00 67,735.33 207,735.33 3,325,000.00
6/1/26 - 65,487.63 65,487.63 3,325,000.00
12/1/26 140,000.00 65,487.63 205,487.63 3,185,000.00
6/1/27 - 63,099.93 63,099.93 3,185,000.00
12/1/27 145,000.00 63,099.93 208,099.93 3,040,000.00
6/1/28 - 59,725.00 59,725.00 3,040,000.00
12/1/28 155,000.00 59,725.00 214,725.00 2,885,000.00
6/1/29 - 55,850.00 55,850.00 2,885,000.00
12/1/29 165,000.00 55,850.00 220,850.00 2,720,000.00
6/1/30 - 51,725.00 51,725.00 2,720,000.00
12/1/30 175,000.00 51,725.00 226,725.00 2,545,000.00
6/1/31 - 47,350.00 47,350.00 2,545,000.00
12/1/31 180,000.00 47,350.00 227,350.00 2,365,000.00
6/1/32 - 42,850.00 42,850.00 2,365,000.00
12/1/32 190,000.00 42,850.00 232,850.00 2,175,000.00
6/1/33 - 38,100.00 38,100.00 2,175,000.00
12/1/33 200,000.00 38,100.00 238,100.00 1,975,000.00
6/1/34 - 33,100.00 33,100.00 1,975,000.00
12/1/34 215,000.00 33,100.00 248,100.00 1,760,000.00
6/1/35 - 27,725.00 27,725.00 1,760,000.00
12/1/35 225,000.00 27,725.00 252,725.00 1,535,000.00
6/1/36 - 24,350.00 24,350.00 1,535,000.00
12/1/36 235,000.00 24,350.00 259,350.00 1,300,000.00
6/1/37 - 20,825.00 20,825.00 1,300,000.00
12/1/37 240,000.00 20,825.00 260,825.00 1,060,000.00
6/1/38 - 17,225.00 17,225.00 1,060,000.00
12/1/38 250,000.00 17,225.00 267,225.00 810,000.00
6/1/39 - 13,162.50 13,162.50 810,000.00
12/1/39 260,000.00 13,162.50 273,162.50 550,000.00
6/1/40 - 8,937.50 8,937.50 550,000.00
12/1/40 270,000.00 8,937.50 278,937.50 280,000.00
6/1/41 - 4,550.00 4,550.00 280,000.00
12/1/41 280,000.00 4,550.00 284,550.00 -
Totals 4,115,000.00 2,006,460.90 6,121,460.90
Schedule of 2019 Payments
(2007 Project, 2011 Project and 2019 Project)
Principal Amount: $4,115,000
Storm Drain System
Item 8.4
Mountain House Page 694 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 317 Date Principal Interest Total Balance
44,860,000
6/1/21 - 1,056,702 1,056,702 44,860,000
12/1/21 - 897,200 897,200 44,860,000
6/1/22 - 897,200 897,200 44,860,000
12/1/22 - 897,200 897,200 44,860,000
6/1/23 - 897,200 897,200 44,860,000
12/1/23 - 897,200 897,200 44,860,000
6/1/24 - 897,200 897,200 44,860,000
12/1/24 - 897,200 897,200 44,860,000
6/1/25 - 897,200 897,200 44,860,000
12/1/25 - 897,200 897,200 44,860,000
6/1/26 - 897,200 897,200 44,860,000
12/1/26 - 897,200 897,200 44,860,000
6/1/27 - 897,200 897,200 44,860,000
12/1/27 - 897,200 897,200 44,860,000
6/1/28 - 897,200 897,200 44,860,000
12/1/28 - 897,200 897,200 44,860,000
6/1/29 - 897,200 897,200 44,860,000
12/1/29 520,000 897,200 1,417,200 44,340,000
6/1/30 - 886,800 886,800 44,340,000
12/1/30 535,000 886,800 1,421,800 43,805,000
6/1/31 - 876,100 876,100 43,805,000
12/1/31 560,000 876,100 1,436,100 43,245,000
6/1/32 - 864,900 864,900 43,245,000
12/1/32 575,000 864,900 1,439,900 42,670,000
6/1/33 - 853,400 853,400 42,670,000
12/1/33 600,000 853,400 1,453,400 42,070,000
6/1/34 - 841,400 841,400 42,070,000
12/1/34 615,000 841,400 1,456,400 41,455,000
6/1/35 - 829,100 829,100 41,455,000
12/1/35 630,000 829,100 1,459,100 40,825,000
6/1/36 - 816,500 816,500 40,825,000
12/1/36 655,000 816,500 1,471,500 40,170,000
6/1/37 - 803,400 803,400 40,170,000
12/1/37 675,000 803,400 1,478,400 39,495,000
6/1/38 - 789,900 789,900 39,495,000
12/1/38 705,000 789,900 1,494,900 38,790,000
6/1/39 - 775,800 775,800 38,790,000
12/1/39 725,000 775,800 1,500,800 38,065,000
6/1/40 - 761,300 761,300 38,065,000
12/1/40 755,000 761,300 1,516,300 37,310,000
6/1/41 - 746,200 746,200 37,310,000
12/1/41 780,000 746,200 1,526,200 36,530,000
6/1/42 - 730,600 730,600 36,530,000
12/1/42 1,985,000 730,600 2,715,600 34,545,000
6/1/43 690,900 690,900 34,545,000
12/1/43 2,065,000 690,900 2,755,900 32,480,000
6/1/44 649,600 649,600 32,480,000
12/1/44 2,150,000 649,600 2,799,600 30,330,000
6/1/45 606,600 606,600 30,330,000
12/1/45 2,240,000 606,600 2,846,600 28,090,000
6/1/46 561,800 561,800 28,090,000
12/1/46 2,330,000 561,800 2,891,800 25,760,000
6/1/47 515,200 515,200 25,760,000
12/1/47 2,425,000 515,200 2,940,200 23,335,000
6/1/48 466,700 466,700 23,335,000
12/1/48 2,525,000 466,700 2,991,700 20,810,000
6/1/49 416,200 416,200 20,810,000
12/1/49 2,630,000 416,200 3,046,200 18,180,000
6/1/50 363,600 363,600 18,180,000
12/1/50 2,735,000 363,600 3,098,600 15,445,000
6/1/51 308,900 308,900 15,445,000
12/1/51 2,845,000 308,900 3,153,900 12,600,000
6/1/52 252,000 252,000 12,600,000
12/1/52 2,965,000 252,000 3,217,000 9,635,000
6/1/53 192,700 192,700 9,635,000
12/1/53 3,085,000 192,700 3,277,700 6,550,000
6/1/54 131,000 131,000 6,550,000
12/1/54 3,210,000 131,000 3,341,000 3,340,000
6/1/55 66,800 66,800 3,340,000
12/1/55 3,340,000 66,800 3,406,800 -
Totals 44,860,000.00 47,903,902.22 92,763,902.22
Principal Amount: $44,860,000
Water System
Schedule of 2020A Payments
Item 8.4
Mountain House Page 695 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 318 Date Principal Interest Total Payment Balance
34,760,000
6/1/21 - 818,791 818,791 34,760,000
12/1/21 - 695,200 695,200 34,760,000
6/1/22 - 695,200 695,200 34,760,000
12/1/22 - 695,200 695,200 34,760,000
6/1/23 - 695,200 695,200 34,760,000
12/1/23 - 695,200 695,200 34,760,000
6/1/24 - 695,200 695,200 34,760,000
12/1/24 - 695,200 695,200 34,760,000
6/1/25 - 695,200 695,200 34,760,000
12/1/25 - 695,200 695,200 34,760,000
6/1/26 - 695,200 695,200 34,760,000
12/1/26 - 695,200 695,200 34,760,000
6/1/27 - 695,200 695,200 34,760,000
12/1/27 - 695,200 695,200 34,760,000
6/1/28 - 695,200 695,200 34,760,000
12/1/28 - 695,200 695,200 34,760,000
6/1/29 - 695,200 695,200 34,760,000
12/1/29 405,000 695,200 1,100,200 34,355,000
6/1/30 - 687,100 687,100 34,355,000
12/1/30 420,000 687,100 1,107,100 33,935,000
6/1/31 - 678,700 678,700 33,935,000
12/1/31 440,000 678,700 1,118,700 33,495,000
6/1/32 - 669,900 669,900 33,495,000
12/1/32 450,000 669,900 1,119,900 33,045,000
6/1/33 - 660,900 660,900 33,045,000
12/1/33 470,000 660,900 1,130,900 32,575,000
6/1/34 - 651,500 651,500 32,575,000
12/1/34 485,000 651,500 1,136,500 32,090,000
6/1/35 - 641,800 641,800 32,090,000
12/1/35 495,000 641,800 1,136,800 31,595,000
6/1/36 - 631,900 631,900 31,595,000
12/1/36 510,000 631,900 1,141,900 31,085,000
6/1/37 - 621,700 621,700 31,085,000
12/1/37 530,000 621,700 1,151,700 30,555,000
6/1/38 - 611,100 611,100 30,555,000
12/1/38 555,000 611,100 1,166,100 30,000,000
6/1/39 - 600,000 600,000 30,000,000
12/1/39 570,000 600,000 1,170,000 29,430,000
6/1/40 - 588,600 588,600 29,430,000
12/1/40 590,000 588,600 1,178,600 28,840,000
6/1/41 - 576,800 576,800 28,840,000
12/1/41 615,000 576,800 1,191,800 28,225,000
6/1/42 - 564,500 564,500 28,225,000
12/1/42 1,535,000 564,500 2,099,500 26,690,000
6/1/43 533,800 533,800 26,690,000
12/1/43 1,595,000 533,800 2,128,800 25,095,000
6/1/44 501,900 501,900 25,095,000
12/1/44 1,660,000 501,900 2,161,900 23,435,000
6/1/45 468,700 468,700 23,435,000
12/1/45 1,730,000 468,700 2,198,700 21,705,000
6/1/46 434,100 434,100 21,705,000
12/1/46 1,800,000 434,100 2,234,100 19,905,000
6/1/47 398,100 398,100 19,905,000
12/1/47 1,875,000 398,100 2,273,100 18,030,000
6/1/48 360,600 360,600 18,030,000
12/1/48 1,950,000 360,600 2,310,600 16,080,000
6/1/49 321,600 321,600 16,080,000
12/1/49 2,030,000 321,600 2,351,600 14,050,000
6/1/50 281,000 281,000 14,050,000
12/1/50 2,115,000 281,000 2,396,000 11,935,000
6/1/51 238,700 238,700 11,935,000
12/1/51 2,200,000 238,700 2,438,700 9,735,000
6/1/52 194,700 194,700 9,735,000
12/1/52 2,290,000 194,700 2,484,700 7,445,000
6/1/53 148,900 148,900 7,445,000
12/1/53 2,385,000 148,900 2,533,900 5,060,000
6/1/54 101,200 101,200 5,060,000
12/1/54 2,480,000 101,200 2,581,200 2,580,000
6/1/55 51,600 51,600 2,580,000
12/1/55 2,580,000 51,600 2,631,600 -
Totals 34,760,000.00 37,075,991.11 71,835,991.11
Principal Amount: $34,760,000
Wastewater System
Schedule of 2020A Payments
Item 8.4
Mountain House Page 696 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 319 Date Principal Interest Total Balance
11,705,000
6/1/21 - 275,718 275,718 11,705,000
12/1/21 - 234,100 234,100 11,705,000
6/1/22 - 234,100 234,100 11,705,000
12/1/22 - 234,100 234,100 11,705,000
6/1/23 - 234,100 234,100 11,705,000
12/1/23 - 234,100 234,100 11,705,000
6/1/24 - 234,100 234,100 11,705,000
12/1/24 - 234,100 234,100 11,705,000
6/1/25 - 234,100 234,100 11,705,000
12/1/25 - 234,100 234,100 11,705,000
6/1/26 - 234,100 234,100 11,705,000
12/1/26 - 234,100 234,100 11,705,000
6/1/27 - 234,100 234,100 11,705,000
12/1/27 - 234,100 234,100 11,705,000
6/1/28 - 234,100 234,100 11,705,000
12/1/28 - 234,100 234,100 11,705,000
6/1/29 - 234,100 234,100 11,705,000
12/1/29 140,000 234,100 374,100 11,565,000
6/1/30 - 231,300 231,300 11,565,000
12/1/30 145,000 231,300 376,300 11,420,000
6/1/31 - 228,400 228,400 11,420,000
12/1/31 155,000 228,400 383,400 11,265,000
6/1/32 - 225,300 225,300 11,265,000
12/1/32 160,000 225,300 385,300 11,105,000
6/1/33 - 222,100 222,100 11,105,000
12/1/33 165,000 222,100 387,100 10,940,000
6/1/34 - 218,800 218,800 10,940,000
12/1/34 170,000 218,800 388,800 10,770,000
6/1/35 - 215,400 215,400 10,770,000
12/1/35 175,000 215,400 390,400 10,595,000
6/1/36 - 211,900 211,900 10,595,000
12/1/36 180,000 211,900 391,900 10,415,000
6/1/37 - 208,300 208,300 10,415,000
12/1/37 190,000 208,300 398,300 10,225,000
6/1/38 - 204,500 204,500 10,225,000
12/1/38 195,000 204,500 399,500 10,030,000
6/1/39 - 200,600 200,600 10,030,000
12/1/39 200,000 200,600 400,600 9,830,000
6/1/40 - 196,600 196,600 9,830,000
12/1/40 205,000 196,600 401,600 9,625,000
6/1/41 - 192,500 192,500 9,625,000
12/1/41 215,000 192,500 407,500 9,410,000
6/1/42 - 188,200 188,200 9,410,000
12/1/42 510,000 188,200 698,200 8,900,000
6/1/43 178,000 178,000 8,900,000
12/1/43 535,000 178,000 713,000 8,365,000
6/1/44 167,300 167,300 8,365,000
12/1/44 555,000 167,300 722,300 7,810,000
6/1/45 156,200 156,200 7,810,000
12/1/45 575,000 156,200 731,200 7,235,000
6/1/46 144,700 144,700 7,235,000
12/1/46 600,000 144,700 744,700 6,635,000
6/1/47 132,700 132,700 6,635,000
12/1/47 625,000 132,700 757,700 6,010,000
6/1/48 120,200 120,200 6,010,000
12/1/48 650,000 120,200 770,200 5,360,000
6/1/49 107,200 107,200 5,360,000
12/1/49 675,000 107,200 782,200 4,685,000
6/1/50 93,700 93,700 4,685,000
12/1/50 705,000 93,700 798,700 3,980,000
6/1/51 79,600 79,600 3,980,000
12/1/51 735,000 79,600 814,600 3,245,000
6/1/52 64,900 64,900 3,245,000
12/1/52 765,000 64,900 829,900 2,480,000
6/1/53 49,600 49,600 2,480,000
12/1/53 795,000 49,600 844,600 1,685,000
6/1/54 33,700 33,700 1,685,000
12/1/54 825,000 33,700 858,700 860,000
6/1/55 17,200 17,200 860,000
12/1/55 860,000 17,200 877,200 -
Totals 11,705,000.00 12,433,217.78 24,138,217.78
Principal Amount: $11,705,000
Storm Drain System
Schedule of 2020A Payments
Item 8.4
Mountain House Page 697 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 320 Date Principal Interest Total Balance
19,670,000
6/1/21 - 463,338 463,338 19,670,000
12/1/21 - 393,400 393,400 19,670,000
6/1/22 - 393,400 393,400 19,670,000
12/1/22 105,000 393,400 498,400 19,565,000
6/1/23 - 391,300 391,300 19,565,000
12/1/23 180,000 391,300 571,300 19,385,000
6/1/24 - 387,700 387,700 19,385,000
12/1/24 270,000 387,700 657,700 19,115,000
6/1/25 - 382,300 382,300 19,115,000
12/1/25 360,000 382,300 742,300 18,755,000
6/1/26 - 375,100 375,100 18,755,000
12/1/26 455,000 375,100 830,100 18,300,000
6/1/27 - 366,000 366,000 18,300,000
12/1/27 560,000 366,000 926,000 17,740,000
6/1/28 - 354,800 354,800 17,740,000
12/1/28 665,000 354,800 1,019,800 17,075,000
6/1/29 - 341,500 341,500 17,075,000
12/1/29 245,000 341,500 586,500 16,830,000
6/1/30 - 336,600 336,600 16,830,000
12/1/30 345,000 336,600 681,600 16,485,000
6/1/31 - 329,700 329,700 16,485,000
12/1/31 445,000 329,700 774,700 16,040,000
6/1/32 - 320,800 320,800 16,040,000
12/1/32 555,000 320,800 875,800 15,485,000
6/1/33 - 309,700 309,700 15,485,000
12/1/33 670,000 309,700 979,700 14,815,000
6/1/34 - 296,300 296,300 14,815,000
12/1/34 795,000 296,300 1,091,300 14,020,000
6/1/35 - 280,400 280,400 14,020,000
12/1/35 935,000 280,400 1,215,400 13,085,000
6/1/36 - 261,700 261,700 13,085,000
12/1/36 1,070,000 261,700 1,331,700 12,015,000
6/1/37 - 240,300 240,300 12,015,000
12/1/37 1,215,000 240,300 1,455,300 10,800,000
6/1/38 - 216,000 216,000 10,800,000
12/1/38 1,365,000 216,000 1,581,000 9,435,000
6/1/39 - 188,700 188,700 9,435,000
12/1/39 1,530,000 188,700 1,718,700 7,905,000
6/1/40 - 158,100 158,100 7,905,000
12/1/40 1,700,000 158,100 1,858,100 6,205,000
6/1/41 - 124,100 124,100 6,205,000
12/1/41 1,880,000 124,100 2,004,100 4,325,000
6/1/42 - 86,500 86,500 4,325,000
12/1/42 2,065,000 86,500 2,151,500 2,260,000
6/1/43 45,200 45,200 2,260,000
12/1/43 2,260,000 45,200 2,305,200 -
Totals 19,670,000.00 13,229,137.78 32,899,137.78
Principal Amount: $19,670,000
Water System
Schedule of 2020B Payments
Item 8.4
Mountain House Page 698 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 321 Date Principal Interest Total Payment Balance
12,210,000
6/1/21 - 287,613 287,613 12,210,000
12/1/21 - 244,200 244,200 12,210,000
6/1/22 - 244,200 244,200 12,210,000
12/1/22 35,000 244,200 279,200 12,175,000
6/1/23 - 243,500 243,500 12,175,000
12/1/23 85,000 243,500 328,500 12,090,000
6/1/24 - 241,800 241,800 12,090,000
12/1/24 150,000 241,800 391,800 11,940,000
6/1/25 - 238,800 238,800 11,940,000
12/1/25 215,000 238,800 453,800 11,725,000
6/1/26 - 234,500 234,500 11,725,000
12/1/26 285,000 234,500 519,500 11,440,000
6/1/27 - 228,800 228,800 11,440,000
12/1/27 350,000 228,800 578,800 11,090,000
6/1/28 - 221,800 221,800 11,090,000
12/1/28 430,000 221,800 651,800 10,660,000
6/1/29 - 213,200 213,200 10,660,000
12/1/29 95,000 213,200 308,200 10,565,000
6/1/30 - 211,300 211,300 10,565,000
12/1/30 160,000 211,300 371,300 10,405,000
6/1/31 - 208,100 208,100 10,405,000
12/1/31 230,000 208,100 438,100 10,175,000
6/1/32 - 203,500 203,500 10,175,000
12/1/32 305,000 203,500 508,500 9,870,000
6/1/33 - 197,400 197,400 9,870,000
12/1/33 385,000 197,400 582,400 9,485,000
6/1/34 - 189,700 189,700 9,485,000
12/1/34 475,000 189,700 664,700 9,010,000
6/1/35 - 180,200 180,200 9,010,000
12/1/35 565,000 180,200 745,200 8,445,000
6/1/36 - 168,900 168,900 8,445,000
12/1/36 665,000 168,900 833,900 7,780,000
6/1/37 - 155,600 155,600 7,780,000
12/1/37 765,000 155,600 920,600 7,015,000
6/1/38 - 140,300 140,300 7,015,000
12/1/38 870,000 140,300 1,010,300 6,145,000
6/1/39 - 122,900 122,900 6,145,000
12/1/39 985,000 122,900 1,107,900 5,160,000
6/1/40 - 103,200 103,200 5,160,000
12/1/40 1,100,000 103,200 1,203,200 4,060,000
6/1/41 - 81,200 81,200 4,060,000
12/1/41 1,220,000 81,200 1,301,200 2,840,000
6/1/42 - 56,800 56,800 2,840,000
12/1/42 1,350,000 56,800 1,406,800 1,490,000
6/1/43 29,800 29,800 1,490,000
12/1/43 1,490,000 29,800 1,519,800 -
Totals 12,210,000.00 8,362,813.33 20,572,813.33
Principal Amount: $12,210,000
Wastewater System
Schedule of 2020B Payments
Item 8.4
Mountain House Page 699 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 322 Date Principal Interest Total Balance
5,420,000
6/1/21 - 127,671 127,671 5,420,000
12/1/21 - 108,400 108,400 5,420,000
6/1/22 - 108,400 108,400 5,420,000
12/1/22 40,000 108,400 148,400 5,380,000
6/1/23 - 107,600 107,600 5,380,000
12/1/23 55,000 107,600 162,600 5,325,000
6/1/24 - 106,500 106,500 5,325,000
12/1/24 80,000 106,500 186,500 5,245,000
6/1/25 - 104,900 104,900 5,245,000
12/1/25 105,000 104,900 209,900 5,140,000
6/1/26 - 102,800 102,800 5,140,000
12/1/26 135,000 102,800 237,800 5,005,000
6/1/27 - 100,100 100,100 5,005,000
12/1/27 165,000 100,100 265,100 4,840,000
6/1/28 - 96,800 96,800 4,840,000
12/1/28 190,000 96,800 286,800 4,650,000
6/1/29 - 93,000 93,000 4,650,000
12/1/29 75,000 93,000 168,000 4,575,000
6/1/30 - 91,500 91,500 4,575,000
12/1/30 100,000 91,500 191,500 4,475,000
6/1/31 - 89,500 89,500 4,475,000
12/1/31 125,000 89,500 214,500 4,350,000
6/1/32 - 87,000 87,000 4,350,000
12/1/32 155,000 87,000 242,000 4,195,000
6/1/33 - 83,900 83,900 4,195,000
12/1/33 190,000 83,900 273,900 4,005,000
6/1/34 - 80,100 80,100 4,005,000
12/1/34 220,000 80,100 300,100 3,785,000
6/1/35 - 75,700 75,700 3,785,000
12/1/35 255,000 75,700 330,700 3,530,000
6/1/36 - 70,600 70,600 3,530,000
12/1/36 290,000 70,600 360,600 3,240,000
6/1/37 - 64,800 64,800 3,240,000
12/1/37 330,000 64,800 394,800 2,910,000
6/1/38 - 58,200 58,200 2,910,000
12/1/38 370,000 58,200 428,200 2,540,000
6/1/39 - 50,800 50,800 2,540,000
12/1/39 415,000 50,800 465,800 2,125,000
6/1/40 - 42,500 42,500 2,125,000
12/1/40 460,000 42,500 502,500 1,665,000
6/1/41 - 33,300 33,300 1,665,000
12/1/41 505,000 33,300 538,300 1,160,000
6/1/42 - 23,200 23,200 1,160,000
12/1/42 555,000 23,200 578,200 605,000
6/1/43 12,100 12,100 605,000
12/1/43 605,000 12,100 617,100 -
Totals 5,420,000.00 3,602,671.11 9,022,671.11
Principal Amount: $5,420,000
Storm Drain System
Schedule of 2020B Payments
Item 8.4
Mountain House Page 700 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 323 Projections
REVENUES
The revenue projections are based on the following assumptions:
- Building permits will increase by the following amounts (the average number of permits issued since inception is 358 permits per year):
o FY 2026/2027: 300 permits
o FY 2027/2028: 300 permits
o FY 2028/2029: 300 permits
o FY 2029/2030: 300 permits
o FY 2030/2031: 300 permits
- Water rates will increase by 5% annually.
- Wastewater rates will not increase based on the rate study. - Engineering News Record (ENR) will increase by 3% per year (three percent is the average ENR over the last ten years).
Revenues by Fund
EST 2026/27 EST 2027/28 EST 2028/29 EST 2029/30 EST 2030/31
GENERAL FUNDS
General Fund
Property tax-secured 10,692,692 11,291,591 11,909,901 12,548,163 13,206,931 Property tax-secured-SB813 367,808 388,409 409,678 431,633 454,294 Property tax-unsecured 642,672 678,668 715,831 754,193 793,787 Property tax-unsecured-SB813 14,964 15,802 16,668 17,561 18,483 Property Transfer Tax 489,600 499,392 509,380 519,567 529,959 Sales Tax 86,700 88,434 90,203 92,007 93,847
License/permits-plan check 7,000 7,000 7,000 7,000 7,000 Franchises 492,745 510,489 528,232 545,976 563,720
Interest income 350,000 350,000 350,000 350,000 350,000 Rents/concessions 10,000 10,000 10,000 10,000 10,000
Homeowners' property tax relief 58,587 60,696 62,806 64,916 67,026 West Valley commercial 230,448 238,747 247,045 255,344 263,642 Utility services fee-solid waste 878,420 910,052 941,684 973,316 1,004,948 Charges for services 5,000 5,000 5,000 5,000 5,000
Other miscellaneous revenues 5,000 5,000 5,000 5,000 5,000 14,331,637 15,059,280 15,808,427 16,579,675 17,373,636
Traffic Impact Fee Program
Traffic impact administration fee 182,529 187,915 193,462 199,176 205,061 Communitiy Facility Fee Program
Community facility admin fee 217,873 224,334 230,989 237,844 244,904 Total General Funds 14,732,039 15,471,530 16,232,879 17,016,695 17,823,601 Item 8.4
Mountain House Page 701 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 324 EST 2026/27 EST 2027/28 EST 2028/29 EST 2029/30 EST 2030/31
SPECIAL ASSESSMENT FUNDS
Special Tax No. 1: Roads
Interest income 150,000 150,000 150,000 150,000 150,000 Special assessments-current 10,826,567 11,508,750 12,219,513 12,959,903 13,731,007 10,976,567 11,658,750 12,369,513 13,109,903 13,881,007
Special Tax No. 2: Public Safety
Special assessments-current 5,544,172 5,893,511 6,257,485 6,636,631 7,031,506 5,544,172 5,893,511 6,257,485 6,636,631 7,031,506
Special Tax No. 3: Parks
Rents/concessions 120,000 120,000 120,000 120,000 120,000 Special assessments-current 954,581 1,014,729 1,077,397 1,142,678 1,210,666 1,074,581 1,134,729 1,197,397 1,262,678 1,330,666
Special Tax No. 4: Public Works
Interest income 10,000 10,000 10,000 10,000 10,000
Special assessments-current 1,003,836 1,067,088 1,132,989 1,201,638 1,273,135 1,013,836 1,077,088 1,142,989 1,211,638 1,283,135
Total Special Assessment Funds 18,609,156 19,764,078 20,967,384 22,220,851 23,526,313 EST 2026/27 EST 2027/28 EST 2028/29 EST 2029/30 EST 2030/31
SPECIAL REVENUE FUNDS
Development Services
Charges for services 2,100,000 2,184,000 2,271,360 2,362,214 2,456,703 Gas Tax
Gas tax 617,946 634,630 651,765 669,363 687,436
Measure K
Measure K funds 616,200 632,837 649,924 667,472 685,494 Total Special Revenue Funds 3,334,146 3,451,468 3,573,049 3,699,049 3,829,633 Item 8.4
Mountain House Page 702 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 325 EST 2026/27 EST 2027/28 EST 2028/29 EST 2029/30 EST 2030/31
ENTERPRISE FUNDS
Water Operations
Utility service fee-operations 7,133,525 7,771,788 8,456,043 9,189,294 9,974,730 Miscellaneous revenue 26,000 26,000 26,000 26,000 26,000 7,159,525 7,797,788 8,482,043 9,215,294 10,000,730
Water Debt Service
Utility service fee-pledged facility 6,596,338 7,049,650 7,524,225 8,020,929 8,540,663 Interest income - - - - -
6,596,338 7,049,650 7,524,225 8,020,929 8,540,663
Wastewater Operations
Interest income 10,000 10,000 10,000 10,000 10,000
Utility service fee-operations 4,324,297 4,486,864 4,649,432 4,811,999 4,974,567 4,334,297 4,496,864 4,659,432 4,821,999 4,984,567
Wastewater Debt Service
Utility service fee-pledged facility 5,040,040 5,386,400 5,749,007 6,128,521 6,525,633 5,040,040 5,386,400 5,749,007 6,128,521 6,525,633
Storm Operations
Interest income 15,000 15,000 15,000 15,000 15,000
Utility service fee-operations 837,561 869,049 900,536 932,023 963,510 Storm drain system-NPDES 225,000 225,000 225,000 225,000 225,000 1,077,561 1,109,049 1,140,536 1,172,023 1,203,510
Storm Debt Service
Utility service fee-pledged facility 1,723,527 1,841,971 1,965,970 2,095,752 2,231,551 1,723,527 1,841,971 1,965,970 2,095,752 2,231,551
Total Enterprise Funds 25,931,288 27,681,722 29,521,212 31,454,518 33,486,655 EST 2026/27 EST 2027/28 EST 2028/29 EST 2029/30 EST 2030/31
RESTRICTED FUNDS
Landscape & Lighting District 1
Special assessments-current 60,000 60,000 60,000 60,000 60,000 60,000 60,000 60,000 60,000 60,000
Landscape & Lighting District 2
Special assessments-current 41,000 41,000 41,000 41,000 41,000 41,000 41,000 41,000 41,000 41,000
Landscape & Lighting District 3
Special assessments-current 370,000 370,000 370,000 370,000 370,000 370,000 370,000 370,000 370,000 370,000
TIF Impact Fee
Interest income 100,000 100,000 100,000 100,000 100,000 Impact mitigation fee 6,168,258 6,353,306 6,543,905 6,740,222 6,942,429 6,268,258 6,453,306 6,643,905 6,840,222 7,042,429
CFF Impact Fee
Interest income 100,000 100,000 100,000 100,000 100,000 Community facility impact 7,175,289 7,390,548 7,612,264 7,840,632 8,075,851 7,275,289 7,490,548 7,712,264 7,940,632 8,175,851
Total Restricted Funds 14,014,547 14,414,853 14,827,169 15,251,854 15,689,280 TOTAL FUNDS 76,621,176 80,783,651 85,121,693 89,642,968 94,355,482 Item 8.4
Mountain House Page 703 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 326
EXPENDITURES
The expenditure projections are based on the following assumptions:
- Personnel cost will increase by 6% annually.
- Utility expenditures will increase by 6% annually.
- Landscaping will increase by 6% annually.
- Road maintenance will increase by 9% annually.
- Slight increases are built in based on expected increases to line items.
Expenditures by Fund
EST 2026/27 EST 2027/28 EST 2028/29 EST 2029/30 EST 2030/31 General Funds
General Fund 4,722,269 4,911,159 5,107,606 5,311,910 5,524,386 Traffic Impact 62,400 64,896 67,492 70,192 72,999
Community Facilities 52,000 54,080 56,243 58,493 60,833 Total General Funds 4,836,669 5,030,135 5,231,341 5,440,595 5,658,218 Special Assessment Funds
Special Tax # 1 - Roads 5,930,335 6,286,155 6,663,325 7,063,124 7,486,912 Special Tax # 2 - Public Safety 10,737,195 11,166,683 11,613,350 12,077,884 12,561,000 Special Tax # 3 - Parks 5,907,618 6,143,923 6,389,680 6,645,267 6,911,078 Special Tax # 4 - Public Works 2,239,548 2,329,130 2,422,296 2,519,187 2,619,955 Total Special Assessment Funds 24,814,697 25,925,892 27,088,650 28,305,463 29,578,944 Special Revenue Funds
Development Services 4,420,712 4,597,541 4,781,443 4,972,700 5,171,608 Gas Tax 617,946 634,630 651,765 669,363 687,436
Measure K
Total Special Revenue Funds 5,038,658 5,232,171 5,433,208 5,642,063 5,859,044 Utility Funds
Water O & M 6,531,174 6,792,421 7,064,118 7,346,683 7,640,550 Wastewater O & M 4,123,648 4,288,594 4,460,138 4,638,543 4,824,085 Stormwater O & M 1,083,085 1,126,409 1,171,465 1,218,323 1,267,056 Total Utility Funds 11,737,907 12,207,423 12,695,720 13,203,549 13,731,691 Restricted Funds
Lighting & Landscaping District 1 34,216 35,585 37,008 38,488 40,028 Lighting & Landscaping District 2 27,800 28,912 30,068 31,271 32,522 Lighting & Landscaping District 3 190,000 197,600 205,504 213,724 222,273 Total Restricted Funds 252,016 262,097 272,581 283,484 294,823 Debt Service
Debt Payments 26,703,452 28,021,875 29,395,370 30,826,056 32,316,127 Total Debt Service 26,703,452 28,021,875 29,395,370 30,826,056 32,316,127 Capital Projects
Capital Projects 6,180,000 3,140,000 2,730,000 2,730,000 2,811,900 Total Capital Projects 6,180,000 3,140,000 2,730,000 2,730,000 2,811,900 Total 79,563,399 79,819,593 82,846,870 86,431,209 90,250,747 Item 8.4
Mountain House Page 704 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 327 2026/27 Fee Schedule
Any work performed may require a deposit and reimbursement agreement.
Deposit amounts, if not specified, will be based on project complexity and scope.
Processing and permit fees are non-refundable.
Deposits shall be subject to Reimbursement Agreements.
Services will be charged on a time and material basis.
Item Description
1 Building permit processing $50
2 Prepare agreement Deposit $5,000 + actual cost + recording fees
Includes reimbursement agreement; acquisition agreement; annexation agreement, memorandum of understanding; deferred improvement agreement; irrevocable offer to dedicate 3 Purchase of City documents Actual Cost
Electronic version (on CD) of any City document $50
Design manual $65
Development standards and specifications $100
Storm drain master plan $90
Water master plan $65
Sanitary sewer master plan $45
Miscellaneous copy costs per page $0.25
Shipping and handling Actual cost + $5
4 Water meter fee (for City installed meters)
1-inch water meter Actual cost + labor
1 1/2-inch water meter Actual cost + labor
2-inch disc water meter Actual cost + labor
Disc meters greater than 2 inches Actual cost + labor
Turbo meters, compound meters, fire service meters and specialty meters Actual cost + labor Construction water usage permit per month Fees as indicated on permit Temporary water service from a fire hydrant $100
Temporary water service for testing new water lines $100 Realtor reconnect fee $200
5 Cut or damaged lock fee Actual cost + labor
Meter / corporation stop valve repairs / replacements Actual cost + labor 6 Utility servicing fees
Returned check fee $35
Utilities late payment fee (charges not paid by delinquent date specified on bill) 10% of unpaid balance Unpaid invoice late payment fee - additional months 1% per Month 10 day notice letter $25
Water service disconnection / reconnection $100
Utility bill payment (amortization) plan $40
At the time a payment plan is approved, 10% of unpaid balance must be paid in addition to the $40 fee Meter Damage/Tampering $1,000
Meter Lock (Damaged or Replaced) $100
Lien Processing Fee $100
Unpaid invoice late payment fee 10% of unpaid balance
Initial permit fees assume a one-time process and handling. Additional fees to be collected with issuance of permit based on estimated staff time or to be invoiced at time and material rates.
All work performed by or on behalf of the City on any development project will be pursuant to an agreement and paid by the Applicant at the full cost including overhead. The City Manager may set an interim fee as a deposit and reconcile to the final cost annually.
Item 8.4
Mountain House Page 705 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 328 Glossary
Adopted Budget - The City budget for a fiscal year, adopted by the City Council by resolution following the close of budget hearings.
Appropriation - Legal authorization granted by City Council or other policy body to make expenditures and incur obligations for a specific purpose within a specific time frame.
Assessed Valuation - A dollar value placed on real estate or other property by the County as a basis for levying property taxes.
Audit - A review of the City’s accounts by an independent auditing firm to substantiate fiscal year-end balances and assure compliance with generally accepted standards for financial accounting and reporting.
Available Fund Balance - The amount of fund balance available to finance appropriation requirements after deducting reserves.
Bond Proceeds - The money paid to the issuer by the purchaser or underwriter of a new issue of municipal securities. These moneys are used to finance the project or purpose for which the securities were issued and to pay certain costs of issuance as may be provided in the bond contract.
Bonds - A certificate of debt issued by an entity, guaranteeing payment of the original investment, plus interest, by a specified future date.
Budget - A plan of financial operation, embodying an estimate of proposed expenditures/ expenses for a given period (typically a fiscal year) and the proposed means of financing them (revenue estimates). Upon approval by the City Council , the budget appropriation resolution is the legal basis for expenditures in the fiscal year.
Budget Authority - Under certain circumstances, the City Council may adjust the budgeted appropriations for reasons unforeseen at the time of the adoption of the original budget. Such amendments are made by Board resolution. The City Manager may make transfers of appropriations within a fund family.
Budgetary Control – The control or management of a government or enterprise in accordance with an approved budget to keep expenditures within the limitations of available appropriations and available revenues.
Capital Improvement Budget - Annual appropriations for capital improvement projects such as street improvements, building construction and various kinds of major facility maintenance.
Capital projects are outlined in a five-year expenditure plan which details funding sources and Item 8.4
Mountain House Page 706 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 329 expenditure amounts. They often are multi-year projects which require funding beyond the one-year period of the annual budget.
Capital Investment Program (CIP) - A section in the five-year capital plan listing projects for which some level of funding is available.
Capital Outlay - Expenditures which result in the acquisition of, or addition to, fixed assets.
Capital Project - Any project having assets of significant value and a useful life of five years or more. Capital projects include the purchase of land, design, engineering, and construction of buildings, infrastructure such as streets, bridges, drainage, street lighting, water/sewer systems, etc.
Capital Projects Fund - A fund created to account for financial resources to be used for the acquisition or construction of major capital facilities (other than those financed by proprietary funds and trust funds).
Capitalization Policy - The criteria used by a government to determine which outlays should be reported as fixed assets.
Cash with Fiscal Agent - An asset account reflecting deposits with fiscal agents, such as commercial banks, for the payment of bond principal and interest.
Consumer Price Index (CPI) - A statistical description of price levels provided by the U.S.
Department of Labor. The change in this index from year to year is used to measure the cost of living and economic inflation.
Contingency - An amount of money appropriated for unforeseen expenditures.
Current Service Charges - These are charges imposed to support services provided to individuals. These charges may not exceed the cost of providing the service plus overhead. The rationale behind service charges is that certain services are primarily for the benefit of individuals rather than the general public.
Debt Service - Payment of the principal and interest on an obligation, resulting from the issuance of bonds, notes or leasing arrangements.
Debt Service Fund - A fund established to account for the accumulation of resources for, and the payment of, general long-term debt principal and interest.
Deficit - An excess of expenditures (expenses) over revenues (resources).
Depreciation - (1) Expiration in the service life of fixed assets, other than wasting assets, attributable to wear and tear, deterioration, action of the physical elements, inadequacy and obsolescence. (2) The portion of the cost of a fixed asset, other than wasting assets, charged as Item 8.4
Mountain House Page 707 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 330 an expense during a particular period. In accounting for depreciation, the cost of a fixed asset, less any salvage value, is prorated over the estimated service life of such an asset, and each period is charged with a portion of such cost. Through this process, the entire cost of the asset is ultimately charged off as an expense.
Designated Fund Balance - A portion of an unreserved fund balance that has been “earmarked” by the City Manager or the City Council for specified purposes.
Designation - An account containing money set aside by the City Council for a specific future use. Money in a designation is earmarked for specific use but may not be legally restricted to that use.
Development Impact Fees - Fees placed on the development of land or conditions required for the approval of a development project such as the donation (“dedication” or “exaction”) of certain lands (or money) to specific public uses. The fees are typically justified as an offset to the future impact that development will have on existing infrastructure.
Encumbrance - An anticipated expenditure committed for the payment of goods and services not yet received or paid for. Used in budgeting, encumbrances are not GAAP expenditures or liabilities, but represent the estimated amount of expenditures ultimately to result if unperformed contracts in process are completed.
Enterprise Fund - A fund established to account for operations financed and operated in a manner similar to private business enterprises (e.g., water, gas and electric utilities, airports, parking garages, or transit systems). In this case the governing body intends those costs (i.e., expenses, including depreciation) of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges. A fund established because the governing body has decided that periodic determination of revenues earned, expenses incurred and/or net income is appropriate for capital maintenance, public policy, management controls, accountability or other purposes.
Expenditures - Monies spent, including current operating expenses, debt service and capital outlays.
Expense - The actual spending of funds by an enterprise fund set aside by an appropriation.
Fiscal Year - In accounting terms, it is the net of a twelve-month period used for budgeting and accounting purposes. For the Mountain House Community Services District the period begins on July 1 and ends on June 30 of the subsequent year.
Fixed Assets - Long-lived tangible assets obtained or controlled as a result of past transactions, events or circumstances. Fixed assets include buildings, equipment, and improvements other Item 8.4
Mountain House Page 708 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 331 than buildings and land. In the private sector, these assets are referred to most often as property, plant and equipment.
Franchises Fees- Fees paid to a municipality from a franchisee for “rental” or the ability to provide services to the community. Telephone utilities are specifically exempted from franchise fees by State law.
Full-Time Equivalent (FTE) - The amount of time a regular full or part-time position has been budgeted for in terms of the amount of time an employee works in a year.
Fund - An independent fiscal and accounting entity with a self-balancing set of accounts.
Examples are the General Fund, Special Revenue Funds, Capital Projects, Enterprise, and Internal Service Funds.
Fund Balance - The amount of financial resources available for use. Generally, this represents a summary of all the annual operating surpluses and deficits since the fund's inception.
FY - Fiscal year.
General Operating Fund - The primary fund used to account for all revenues and expenditures of the City not legally restricted as to use. This fund is used to offset the cost of the City’s general operations. Examples of departments financed by the General Fund include the Police and Administrative Support Services Departments.
Government Accounting Standards Board (GASB) - A standard-setting body, associated with the Financial Accounting Foundation, which prescribes standard accounting practices for governmental units.
Grant - Contributions, gifts of cash or other assets from another governmental entity to be used or expended for a specific purpose, activity or facility. w ’ P x Relief - Revenue from the state to offset city loss of property tax for state-imposed $7,000 per dwelling homeowner exemption.
Infrastructure - Facilities on which the continuance and growth of a community depend, such as streets and roads, sewers, public buildings, parks, etc.
Investment Earnings - Revenue earned from the investment of idle public funds.
Joint Powers Authority - The Joint Exercise of Powers Act authorizes local public agencies to exercise common powers and to form joint powers authorities (JPAs) for the purpose of jointly receiving or providing specific services.
Legal Level of Budgetary Control - The level at which spending in excess of budgeted amounts would be a violation of law.
Item 8.4
Mountain House Page 709 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 332 Level of Budgetary Control - One of the three possible levels of budgetary control and authority to which organizations, programs, activities and functions may be subject. These levels of budgetary control are: (a) appropriated budget, (b) legally authorized non-appropriated budget review and approval process, which is outside the appropriated budget process or (c) nonbudgeted financial activities, which are not subject to the appropriated budget and the appropriation process or to any legally authorized non-appropriated budget review and approval process, but still are relevant for sound financial management and oversight.
Levy - (Verb) to impose taxes, special assessments or service charges for the support of governmental activities; (Noun) the total amounts of taxes, and/or special assessments and/or service charges imposed by a governmental agency.
Licenses and Permits - Charges designed to reimburse the City for costs of regulating activities being licensed, such as the permitting of changes to landscaping, driveway encroachments etc.
Lien - A claim on assets, especially property, for the payment of taxes utility service charges or services.
Liquidity - Refers to the ability to rapidly convert an investment into cash.
Local Agency Investment Fund (LAIF) - Was established by the state to enable treasurers to place idle funds in a pool for investment. Each agency is currently limited to LAIF to an investment of $20 million plus any bond proceeds.
Mission Statement - A succinct description of the scope and purpose of the City or department.
Objectives - The expected results or achievements of a budget activity which can be measured and achieved within a given time frame. Achievement of the objective advances the organization towards a corresponding goal.
Operating Budget - Annual appropriation of funds for on-going program costs, including salaries and benefits, services and supplies, debt service and capital outlay.
Ordinance - A formal legislative enactment by the City Council . It has the full force and effect of law within the City boundaries unless preempted by a higher form of law.
Other Expenditures - This category reflects transfer outs of the General Fund. Transfers are used to move funds to other operating funds in order to finance the operations of another fund or to reimburse the other fund for certain services provided to the General Fund.
Other Revenues - This category includes reimbursements from other government agencies, interest earned on investments and contributions. This category also includes some loan repayments made to the General Fund.
Item 8.4
Mountain House Page 710 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 333 Overhead Allocation - A methodology for identifying and allocating overhead, (indirect) costs incurred by the employees to the direct cost programs.
Performance Measure - An annual indicator of achievement or measures of prediction for a program of work unit as defined in the organization of the budget. Measures may be expressed as a number count, fraction, or a percent of achievement related to the size of the problem or service being provided.
Permits, Fees and Charges for Services - This category includes the City’s charges and fees for licenses and permits issued by the City; as well as, the community development services of staff, provided to customers. The license and permit revenues are designed to reimburse the City for costs of regulating the activities being licensed. Fees and charges for services are imposed to support services provided to individuals and businesses.
Property Tax – (Ad Valorem) Homes, businesses, and other taxable real and personal property are subject to a property tax rate of 1% of assessed value. Since Proposition 13 was enacted in 1978, the assessed valuation of real property in the “base year” of 1975-1976 may increase each year by the change in the Consumer Price Index (CPI), not to exceed 2% as long as it is held by the same owner. When there is a transfer of property ownership, or when property is newly constructed, it is reappraised at its current full market value. The property tax is imposed on real property (land and permanently attached improvements such as buildings) and tangible personal property (movable property) located within the state. By definition, this ad valorem tax is based on the property value, as defined in law, rather than on a fixed amount or benefit.
Proposed Budget - The financial and operating document submitted by the City Manager to the City Council for consideration.
Proposition 13 - Article XIIIA of the California Constitution, commonly known as Proposition 13, which limits the maximum annual increase of any ad valorem tax on real property to 1% of the full cash value of such property.
Purchased Services - This category covers a wide-range of services such as consulting services, outside professional, legal, and auditing services, county services, i.e., supplemental police patrol, and animal control services, District facilities maintenance services, etc.
Reimbursement for State Mandated Costs - Article XIIIB, Section 6 of the California Constitution which requires the State to reimburse local agencies for the cost of state-imposed programs. Process is commonly called “SB 90” after its original 1972 legislation.
Reserve - An account used to record a portion of the fund balance as legally segregated for a specific use, usually at a future time.
Item 8.4
Mountain House Page 711 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 334 Resolution - A special order of the City Council which has a lower legal standing than an ordinance.
Revenues - Monies received or anticipated by a local government from both tax and non-tax sources during the fiscal year.
Salaries And Benefits - This major category accounts for full-time and part-time employees, overtime expenses and all employee benefits, such as medical, dental, retirement, life insurance, long term disability, and workers compensation.
SB 90 - Reimbursement process for state mandated costs, named after its original 1972 legislation.
Service Charges - Charges imposed to support services to individuals or to cover the cost of providing such services. The fees charged are limited to the cost of providing the service or regulation required (plus overhead).
Services - Expenditures/expenses for services.
Special Revenue Fund - A fund used to account for the proceeds of specific revenue sources (other than expendable trusts or major capital projects) that are legally restricted to expenditure for specific purposes. GAAP only require the use of special revenue funds when legally mandated.
Supplemental Property Tax - In the event a property changes ownership, the county collects a supplemental property tax assessment in the current tax year by determining a supplemental value. In future tax periods, the property carries the full cash value.
Supplies and Materials - This category of expenses relates to supplies needed and required to operate as a cost of doing business. Some of the major supplies consist of general office supplies, safety supplies, utilities and fuel for District vehicles, etc.
Tax - Compulsory charge levied by a government for the purpose of financing services performed for the common benefit.
Tax Base - The objects or transactions to which a tax is applied (e.g., parcels of property, retail sales, etc.). State law or local ordinances define the tax base and the objects or transactions exempted from taxation.
Tax Rate - The amount of tax applied to the tax base. The rate may be flat, incremental or a percentage of the tax base, or any other reasonable method.
Trust Funds - Funds used to account for assets held by a government in a trustee capacity for individuals, private organizations, other governments and/or other funds.
Item 8.4
Mountain House Page 712 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 335 Undesignated Fund Balance - The City will maintain an Undesignated General Fund Balance to help mitigate the effects of such unanticipated situations as the following:
- Economic downturns
- Loss of revenues to or imposition of additional costs by other governmental agencies - Errors in financial forecasting
- Natural disasters
Unreserved Fund Balance - That portion of a fund balance available for spending or appropriation in the future.
Item 8.4
Mountain House Page 713 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 336 Index
Adjustment................................................ 39 Administration Department.......... 71, 75, 76
Adopted Budget...................................... 328 Appropriation.................................... 39, 328 Audit........................................................ 328 balanced budget ....................................... 38 benefits............................. 35, 310, 332, 334 Bethany ..................................................... 19 Board of Directors...... 18, 37, 38, 39, 40, 80,
308, 309, 310, 328, 330, 332, 333, 334
Board of Directors & Deputy Secretary
Division.................................................. 80 Bonds ...................................................... 328 Budget Authority..................................... 328 Budget Guide ...................................... 36, 37 Budget Message................................ 2, 5, 37 Budget Schedule ....................................... 37 Budgetary Control................... 328, 331, 332
Builders Fund .. 132, 133, 134, 135, 136, 137
capital improvements................. 8, 310, 312
Capital Outlay.......................................... 329 Capital Project................................... 45, 329 Capital Projects Fund .............. 150, 151, 329
Capital Projects Funds............................... 45 CFF....................................................... 61, 96 Code Enforcement Division..................... 105
Community Facilities Fees .............. 120, 148
Community Facilities Fund...................... 126
compensation ........................... 35, 307, 334
Consumer Price Index ..................... 329, 333
Contingency ............................................ 329 Customer Service Division ........................ 85
Debt Service ................ 46, 61, 120, 148, 329
Department Budgets........................... 37, 69
Development Division............................... 99
Emergency Preparedness Services Division
............................................................. 119 Encumbrance .......................................... 330 Engineering Department............... 87, 91, 92
Enterprise funds........................................ 60 Enterprise Funds................................. 45, 54 Expenditures.......38, 39, 57, 66, 67, 70, 122,
329, 330, 332, 334
Finance Department ..................... 39, 40, 83
Fixed Assets............................................. 330 fulltime...................................................... 35 Fund Balance............. 59, 328, 330, 331, 335
Fund Budgets.................................... 37, 121 Gann Initiative........................................... 68 GASB........................................................ 331 General Fund.... 10, 11, 43, 45, 50, 123, 331,
332, 335
grant.................................................. 43, 311 growth..............6, 10, 11, 19, 58, 60, 68, 331
Human Resource Division ......................... 81
Impact Fee Programs Division .................. 96
Information Technology Division.............. 86
infrastructure ... 46, 47, 58, 60, 62, 120, 146,
147, 148, 311, 312, 329, 330
Joint Powers Authority............................ 331
LAIF.......................................................... 332 Law Enforcement Services Division ........ 117
Legal Service Division................................ 79 Library Services Division.......................... 116 Lien.......................................................... 332 Lighting & Landscaping District 46, 143, 144,
145, 146
Mountain House Community Services
District........................... 18, 308, 309, 330
municipalities............................................ 11 operations.......18, 36, 41, 45, 46, 47, 56, 98,
139, 141, 142, 143, 144, 145, 146, 312,
330, 331, 332
Operations & Maintenance Department.. 97
organization chart..................................... 31 Parks Fund................................. 43, 129, 130 Item 8.4
Mountain House Page 714 of 984 City of Mountain House | Fiscal Year 2026/27 Budget 337 permits............................ 11, 50, 54, 62, 333 personnel ............................................ 18, 40 Property Tax............................ 331, 333, 334
Proposed Budget............................... 37, 333
Proposition 111......................................... 68 Proposition 13......................................... 333 Proposition 4............................................. 68 Public Safety Fund....................... 11, 43, 128
Public Works Fund ............................ 43, 131
Recreation Department.................. 106, 108
Regulatory & Compliance Division............ 95
Reserve.............................................. 15, 333 Restricted Funds ....................................... 46 retirement......................................... 35, 334 Revenues......49, 50, 52, 53, 54, 55, 332, 334
Risk Management Division.................. 71, 82
Roads Fund........................................ 43, 127 San Joaquin County Board of Supervisors 19
Service Divisions...................................... 110 special assessment funds.......................... 10
Special Assessment Funds ...... 43, 52, 53, 60
Stormwater Fund .............................. 45, 142
Summary of Transfers......................... 64, 65
Tax Base .................................................. 334 TIF........................................................ 61, 96 Traffic Impact Fees.................... 46, 120, 148
Traffic Impact Fund................................. 125 Undesignated Fund Balance ................... 335
Unreserved Fund Balance....................... 335
utility ..................38, 46, 54, 62, 85, 309, 332
Wastewater Fund...................... 45, 140, 141
Water Fund ............................... 45, 138, 139 Wicklund ................................................... 19 Workshop............................................ 37, 38 Item 8.4
Mountain House Page 715 of 984 POLICY AND ACTION ITEM 8.1
ATTACHMENT B
BEFORE THE CITY COUNCIL OF THE
CITY OF MOUNTAIN HOUSE
RESOLUTION
R-2026-XX
RESOLUTION ESTABLISHING PROPOSITION 4 FOR FISCAL YEAR 2024-2025 AND FISCAL YEAR 2025-2026 APPROPRIATION LIMITS BASED ON AUDITOR’S CALCULATIONS AND ESTABLISHING PROPOSITION 4 FOR FISCAL YEAR 2026-2027 APPROPRIATION LIMITS FOR THE CITY OF MOUNTAIN HOUSE WHEREAS, Article XIII B was added to the California Constitution by way of initiative approved by the voters at a State election held in November 1979, said initiative providing for appropriation limits for State and local governments and being known as “Proposition 4,” and WHEREAS, the Legislature in 1980 enacted Chapter 1205 which implemented the provisions of Article XIII B; and
WHEREAS, Section 7910 of the Government Code requires the governing body of each local jurisdiction, including counties and special districts, to establish appropriation limits required by Article XIII B of the California Constitution; and
WHEREAS, May 28, 2026, they announced that the documentation used, or to be used, in the determination of the appropriation limits was available to the public and said documentation has, in fact, been available since that date; and WHEREAS, at said time and place members of the public were given opportunity to comment on, or object to, the appropriation limits.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Mountain House, determines pursuant to Government Code Section 7910, as follows:
The City of Mountain House appropriation limit for the fiscal year 2024/25 is $61,736,215 and for fiscal year 2025/26 is $68,754,494; and
The Board elects to use the change in California per capita income as the cost of living adjustment and the annual population change for San Joaquin County as the population adjustment factor; and
BE IT FURTHER RESOLVED that the appropriation limit for the City of Mountain House for the fiscal year 2026/27 is $76,227,544.
Item 8.4
Mountain House Page 716 of 984 POLICY AND ACTION ITEM 8.1
ATTACHMENT B
PASSED AND ADOPTED this 9th day of June, 2026 by the following vote of the City Council of the City of Mountain House, to wit:
AYES:
NOES:
ABSENT:
ABSTAIN:
________________________________
ANDY SU, Mayor
City of Mountain House,
County of San Joaquin,
State of California
ATTEST:
City Clerk
City of Mountain House
County of San Joaquin,
State of California
By: _____________________________
Item 8.4
Mountain House Page 717 of 984 550 Howe Avenue, Suite 210
Sacramento, California 95825
Telephone: (916) 564-8727
FAX: (916) 564-8728
INDEPENDENT ACCOUNTANTS’ REPORT ON AGREED-UPON PROCEDURES
APPLIED TO APPROPRIATIONS LIMIT TESTING
To the Honorable Mayor and City Council
City of Mountain House, California
We have performed the procedures enumerated below to the accompanying Appropriations Limit Worksheet of the City of Mountain House (the City) and the City’s component unit, Mountain House Community Services District (the District), for the year ended June 30, 2025. The City’s management is responsible for the appropriations limit calculations for the year ended June 30, 2025.
The City has agreed to and acknowledged that the procedures performed are appropriate to meet the intended purpose of assisting the City in evaluating the appropriations limit calculations in accordance with the requirements of Section 1.5 of Article XIII-B of the California Constitution. The procedures are recommended by the California Committee on Municipal Accounting (CCMA), as presented in the CCMA publication titled Agreed-Upon Procedures Applied to the Appropriations Limit Prescribed by Article XIII-B of the California Constitution. This report may not be suitable for any other purpose. The procedures performed may not address all the items of interest to a user of this report and may not meet the needs of all users of this report and, as such, users are responsible for determining whether the procedures performed are appropriate for their purposes.
The procedures performed and our findings were as follows:
1. We obtained the completed appropriations limit calculation for the fiscal year ended June 30, 2025 and compared the limit and annual adjustment factors included in the worksheet to the limit and annual adjustment factors that were adopted by resolution of the City Council. We also compared the population and inflation factors included in the aforementioned worksheet to those that were selected by a recorded vote of the City Council.
Finding: We noted the City’s appropriations limit and annual adjustment factors were approved by the City Council. However, the City was not able to provide evidence that the District’s appropriations limit and annual adjustment factors for the fiscal year ended June 30, 2025 were approved by the District’s Board of Directors.
Recommendation: We recommend the District’s Board of Directors approve the District’s appropriations limit and annual adjustment factors when its budget is approved each year.
2. For the accompanying appropriations limit calculation, we added the appropriations limit for the prior fiscal year ended June 30, 2024, to the annual adjustment amount, and compared the resulting amount to the appropriations limit for the fiscal year ended June 30, 2025.
Finding: Due to the City incorporating as of July 1, 2024, there was a partial transfer of financial responsibility from the District to the City. Under these circumstances, Article XIII B of the California Constitution requires the governments involved in a transfer of financial responsibility to Item 8.4
Mountain House Page 718 of 984 To the Honorable Mayor and City Council
City of Mountain House, California
transfer a mutually agreed amount of the appropriations limit between the governments. As a result, the City and the District agreed to transfer $61,734,404 of the District’s $62,673,656 appropriations limit from the District to the City in June 2025, which was approved in City Council Resolution 2025-34. However, we believe the District’s appropriations limit of $59,774,588 on July 1, 2024 should have been shared on that date (beginning of the fiscal year) and updated during the year ended June 30, 2025 using the annual adjustment factors as required by the California Constitution.
Appendix A discloses the approach used by the City to update the City’s and District’s appropriations limit calculation and the approach we believe should have been used.
Recommendation: We recommend that the District revise the City’s and District’s appropriations limit for the June 30, 2025 using the approach in Appendix A and then update following fiscal year appropriations limit calculations as needed and have the revised appropriations limits be approved by the City Council and District’s Board of Directors.
3. We compared the June 30, 2025 information presented in the accompanying appropriations limit calculation to the worksheets described in procedure No. 1 above.
Finding: See finding under procedure number 2 above.
Recommendation: See recommendation under procedure number 2 above.
4. We agreed the prior year ended June 30, 2024 appropriations limit presented in the accompanying appropriations limit calculation to the prior year appropriations limit adopted by the City Council.
Finding: See finding under procedure number 2 above.
Recommendation: See recommendation under procedure number 2 above.
We were engaged by the City to perform this agreed-upon procedures engagement and conducted our engagement in accordance with attestation standards established by the American Institute of Certified Public Accountants. We are not engaged to and did not conduct an examination or review engagement, the objective of which would be the expression of an opinion or conclusion, respectively, on Appropriations Limit Calculation. Accordingly, we do not express such an opinion or conclusion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you. No procedures have been performed with respect to the determination of the Appropriations Limit for the base year, as defined by Article XIII-B of the California Constitution, which was computed by the County of San Joaquin.
We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements related to our agreed-upon procedures engagement.
This report is intended solely for the use of the City Council and management of the City and Board of Directors and management of the District and should not be used by those who have not agreed to the procedures and taken responsibility for the sufficiency of the procedures for their purposes. However, this report is a matter of public record and its distribution is not limited.
February 5, 2026
Item 8.4
Mountain House Page 719 of 984 Mountain
House City
Community of
Services Mountain
District House Total
APPROPRIATION LIMIT
ADOPTED BY CITY COUNCIL:
Mountain House Community Services District Appropriations Limit Approved by Board of Directors - 2023/2024 $ 59,774,588 Computation of 2024/2025 Appropriations Limit:
Cost of Living Factor:
Change in California per capita income 1.0362
Population Adjustment Factor:
Population growth in district population 1.0119
Total Growth Factor - 2024/2025 1.0485
Mountain House Community Services District Appropriations Limit - 2024/2025 62,673,656
Transfer to City of Mountain House Based on Percentage
of Budgeted Revenues - City Council Resolution 2025-34, June 11, 2025 1.4986395% 98.5013605% 100.00% Appropriations Limits Adopted by City Council - 2024/2025 939,252 $ 61,734,404 $ 62,673,656 COMPUTATION PER REVIEW:
Mountain House Community Services District Appropriations Limit Approved by Board of Directors - 2023/2024 59,774,588 59,774,588 Transfer to City of Mountain House Based on Percentage
of Budgeted Revenues - July 1, 2024 1.4986395% 98.5013605% 100.00% Appropriations Limits July 1, 2024 895,806 58,878,782 59,774,588 Computation of 2024/2025 Appropriations Limits:
Cost of Living Factor:
Change in California per capita income 1.0362 1.0362 1.0362 Population Adjustment Factor:
Population growth in district population 1.0119 1.0119 1.0119 Auditor computed appropriations limits - 2024/2025 939,280 61,736,215 62,675,495 Variance - Overstatement (Understatement) $ (28) $ (1,811) $ (1,839)
APPENDIX A
CITY OF MOUNTAIN HOUSE AND MOUNTAIN HOUSE COMMUNITY SERVICES DISTRICT
APPROPRIATION LIMIT CALCULATION
Year Ended June 30, 2025
Item 8.4
Mountain House Page 720 of 984 POLICY AND ACTION ITEM 8.1
ATTACHMENT C - EXHIBIT 1
City of Mountain House 2026/27 Fee Schedule
All work performed by or on behalf of the City on any development project will be pursuant to an agreement and paid by the Applicant at the full cost including overhead. The City Manager may set an interim fee as a deposit and reconcile to the final cost annually.
Any work performed may require a deposit and reimbursement agreement.
Deposit amounts, if not specified, will be based on project complexity and scope.
Processing and permit fees are non-refundable.
Initial permit fees assume a one-time process and handling. Additional fees to be collected with issuance of permit based on estimated staff time or to be invoiced at time and material rates.
Deposits shall be subject to Reimbursement Agreements.
Services will be charged on a time and material basis.
Item Description
1 Building permit processing $50
2 Prepare agreement Deposit $5,000 + actual cost + recording fees
Includes reimbursement agreement; acquisition agreement; annexation agreement, memorandum of understanding; deferred improvement agreement; irrevocable offer to dedicate 3 Purchase of City documents Actual Cost
Electronic version (on CD) of any City document $50
Design manual $65
Development standards and specifications $100
Storm drain master plan $90
Water master plan $65
Sanitary sewer master plan $45
Miscellaneous copy costs per page $0.25
Shipping and handling Actual cost + $5
4 Water meter fee (for City installed meters)
1-inch water meter Actual cost + labor
1 1/2-inch water meter Actual cost + labor
2-inch disc water meter Actual cost + labor
Disc meters greater than 2 inches Actual cost + labor
Turbo meters, compound meters, fire service meters and specialty meters Actual cost + labor Construction water usage permit per month Fees as indicated on permit Temporary water service from a fire hydrant $100
Temporary water service for testing new water lines $100 Realtor reconnect fee $200
5 Cut or damaged lock fee Actual cost + labor
Meter / corporation stop valve repairs / replacements Actual cost + labor 6 Utility servicing fees
Returned check fee $35
Utilities late payment fee (charges not paid by delinquent date specified on bill) 10% of unpaid balance Unpaid invoice late payment fee - additional months 1% per Month 10 day notice letter $25
Water service disconnection / reconnection $100
Utility bill payment (amortization) plan $40
At the time a payment plan is approved, 10% of unpaid balance must be paid in addition to the $40 fee Meter Damage/Tampering $1,000
Meter Lock (Damaged or Replaced) $100
Lien Processing Fee $100
Unpaid invoice late payment fee 10% of unpaid balance
Item 8.4
Mountain House Page 721 of 984 POLICY & ACTION ITEM 8.1
ATTACHMENT B
BEFORE THE CITY COUNCIL OF THE CITY OF MOUNTAIN HOUSE
RESOLUTION
R-2026-XX
RESOLUTION ESTABLISHING THE SCHEDULES OF FEES FOR SERVICES WHEREAS, the City Council of the City of Mountain House has adopted the Operating and Capital Improvement Budget for fiscal year 2026/27; and WHEREAS, the City is responsible for reviewing, approving and processing development applications for projects within the City; and
WHEREAS, it is the policy of the City to require any cost related to development activities to be the responsibility of the project applicant; and
WHEREAS, the City provides management and enforcement activities related to utility services, and;
WHEREAS, the City Council has reviewed and approved the attached fiscal year 2026/27 Fee Schedule (Exhibit 1);
NOW, THEREFORE, BE IT RESOLVED that the City Council approves the attached fiscal year 2026/27 Fee Schedule.
Item 8.4
Mountain House Page 722 of 984 POLICY & ACTION ITEM 8.1
ATTACHMENT B
PASSED AND ADOPTED this 9th day of June, 2026 by the following vote of the City Council of the City of Mountain House, to wit:
AYES:
NOES:
ABSENT:
ANDY SU, MAYOR
City of Mountain House,
County of San Joaquin,
State of California
ATTEST:
City Clerk
City of Mountain House,
County of San Joaquin,
State of California
By:
Item 8.4
Mountain House Page 723 of 984
CERTIFICATION OF ASSESSMENTS
Special Tax for Public Works
The City of Mountain House hereby certifies that the Special Taxes and Assessments listed below, to be placed on the 2026/27 Secured Property Tax bill by the City of Mountain House, meet the requirements of Articles XIIIC and XIIID of the California State Constitution.
The City of Mountain House agrees to defend, indemnify and hold harmless the County of San Joaquin, the Board of Supervisors, the Auditor-Controller, its officers and employees, for litigation over whether the requirements of Articles XIIIC and XIIID of the California State Constitution were met with respect to such Special Taxes.
If any judgment is entered against any indemnified party as a result of not meeting the requirements of Articles XIIIC and XIIID of the California State Constitution for such Special Taxes, the City of Mountain House agrees that San Joaquin County may offset the amount of any judgment paid by an indemnified party from any monies collected by San Joaquin County on the C i t y o f Mountain House’s behalf, including property taxes, Special Taxes, fees, charges or assessments.
2026-27 Special Taxes
Special Taxes:
ANDY SU, MAYOR
City of Mountain House
Consolidated Landscape Maintenance Assessment Districts No. 2008-1, 2016, and 2019 Special Tax for Roads and Transportation Services and Community Services Operational and Administrative Functions
Special Tax for Public Safety
Special Tax for Parks, Recreation, and Community Facilities Pledged Facilities Component for the Water, Wastewater, and Storm systems 7 Community Facilities District 2024
Item 8.4
Mountain House Page 724 of 984 POLICY & ACTION ITEM 8.1
ATTACHMENT E
CITY OF MOUNTAIN HOUSE
RESOLUTION
R-2026-XX
RESOLUTION APPROVING UPDATED
FINANCIAL MANAGEMENT MANUAL
WHEREAS, the City Council of the City of Mountain House develops and maintains policies in order to ensure that functions are performed efficiently and procedures are in place to address issues as they arise; and
WHEREAS, the City Manager has compiled certain administrative policies and procedures related to financial management policies and practices; and WHEREAS, the Council now desires to adopt the updated Financial Management Manual, attached to this Resolution as Exhibit 1 and 2.
NOW, THEREFORE, BE IT RESOLVED THAT the City Council adopts the updated Financial Management Manual attached to this Resolution as Exhibit 1 and 2.
PASSED AND ADOPTED this 9th day of June, 2026 by the following vote of the City Council of the City of Mountain House, to wit:
AYES:
NOES:
ABSENT:
ANDY SU, MAYOR
City of Mountain House
County of San Joaquin,
State of California
ATTEST:
CITY CLERK
Item 8.4
Mountain House Page 725 of 984 POLICY & ACTION ITEM 8.1
ATTACHMENT E
City of Mountain House
County of San Joaquin
State of California
By:
Item 8.4
Mountain House Page 726 of 984
CITY OF MOUNTAIN HOUSE
FINANCIAL MANAGEMENT MANUAL
Item 8.4
Mountain House Page 727 of 984 Adopted 06/11/2025 2
Section 100
INTRODUCTION
Overview.....................................................................................................................................100110 Internal Control Concepts............................................................................................................110120 Risk Assessment ......................................................................................................................120130 Section 200
PURCHASING AND CASH DISBURSEMENTS
Purchasing.........................................................................................................................................210 California Uniform Public Construction Cost Accounting Act ........................................................220 California Uniform Public Construction Cost Accounting – Approved Contractors List Procedure ...........................................................................................................................230 Ethical Standards of Conduct............................................................................................................240 City Credit Cards ..............................................................................................................................250 Accounts Payable and Cash Disbursements ..................................................................................260 Section 300
TRAVEL POLICIES AND PAYROLL SYSTEM AND PROCESSING PROCEDURES Travel Policy.....................................................................................................................................310 Current Mileage Reimbursement Rate ..............................................................................................320 Payroll System and Processing .........................................................................................................330 Section 400
CAPITAL ASSETS AND INVENTORY MANAGEMENT
Capital Asset Accounting .................................................................................................................410 Contributions/Dedications of Capital Assets....................................................................................420 Inventory of Capital Assets...............................................................................................................430 Surplus Property................................................................................................................................440 Section 500
BUDGET AND FUND ACCOUNTING POLICIES AND PROCEDURES
Budget Policies and Assumptions.....................................................................................................510 Budget Preparation Timeline and Procedures.............................................................................530520 Budget Adjustments and Amendments.......................................................................................540530 Fund Structure and Creation and Closure of Funds ....................................................................550540 Fund Balance Policy Under GASB Statement 54 .......................................................................560550 Debt Management Policy ...........................................................................................................570560 Interfund Loan Policy..................................................................................................................580570 Item 8.4
Mountain House Page 728 of 984 Adopted 06/11/2025 3
Section 600
BANK, TREASURY, AND INVESTMENT POLICIES
Cash and Investments.......................................................................................................................610 Investment Policy .............................................................................................................................620 Bank, Investment and County Treasury Reconciliation...................................................................630 Imprest Cash Checking Account Policy ...........................................................................................640 Section 700
RECEIVABLES, BILLING, COLLECTION, AND CASH RECEIPTING
Utility Billing and Collection ...........................................................................................................710 Section 800
NOTES AND MEMORANDA
Item 8.4
Mountain House Page 729 of 984 4 Section 110
The purpose of this manual is to provide a guide on the conduct of the City's financial affairs.
As described in the Preface, this manual is divided into six Sections:
• Introduction (100)
• Purchasing and Cash Disbursements (200)
• Travel Policies and Payroll System and Processing Procedures (300) • Capital Assets and Inventory Management (400)
• Budget and Fund Accounting Policies and Procedures (500) • Bank, Treasury, and Investment Policies (600)
• Receivables, Billing, Collection, and Cash Receipting (700) • Notes and Memoranda (800)
Each of these sections begins with an overview that further describes its purpose and organization.
INTRODUCTION
Item 8.4
Mountain House Page 730 of 984 5 Section 115120
Faithful stewardship of the public assets and resources that have been entrusted to us is the responsibility of all City employees. Assuring appropriate internal control over the use of these assets is one of the key tools available to us in meeting this responsibility. The following is an outline of internal control concepts.
PURPOSE OF INTERNAL CONTROLS
The objective of internal control systems is to provide reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, and to ensure that transactions are properly recorded to permit the preparation of financial statements in accordance with generally accepted accounting principles. The concept of reasonable assurance recognizes that the cost of control should not exceed the benefits likely to be derived, and that estimates and judgments are required to be made by management in evaluating these costs and benefits.
INTERNAL CONTROLS ARE FOR THE EMPLOYEE
By establishing procedures that reduce the opportunity for employees to make unauthorized transactions, the City protects employees from unwarranted suspicions when unusual events or trends are identified.
STANDARD INTERNAL CONTROLS
The three most common types of internal controls are using and documenting standard operating procedures; formalizing approval authorizations; and separating duties. None of these approaches in themselves can guarantee the appropriate use of City assets at all times, but they represent a reasonable effort to reduce the opportunity for misuse of City assets.
SEPARATION OF DUTIES
Of the three approaches noted above, "separation of duties" is the most common internal control methodology by ensuring that no one individual has total control over an accounting transaction.
For example, the responsibility for the purchasing/disbursement function would ideally be segregated between separate departments or individuals as follows:
• Purchasing (authorization to acquire)
• Receiving (approval to pay)
• Accounting (disbursement)
However, no system of internal control based on separation of duties will be successful if there is collusion between parties. In addition, any employee who is so inclined may identify methods of misusing assets. However, this should not deter an organization from establishing reasonable controls to reduce the opportunity and temptation to misuse City assets.
INTERNAL CONTROL CONCEPTS
Item 8.4
Mountain House Page 731 of 984 6 Section 120130
Introduction
A strong system of internal control must respond to changes in the City’s operations that inevitably occur as time progresses. The best designed set of procedures for today may be deficient next year when circumstances either within or outside the City create new risks that require modifying the system of internal control to effectively address them. Other procedures that were needed in the past may no longer be needed. Through an effective risk assessment process, the City intends to respond to changing circumstances and ensure the City’s system of internal control remains robust and up-to-date.
Triggers for Risk Assessment
Events that indicate the City’s risks may have changed and that risk assessment is needed may include the following:
• New revenue sources.
• Offering of new services or discontinuation of services previously performed. • Significant changes in revenue or expenses in a particular area, especially changes that increase the complexity of accounting for transactions. • Turnover in key internal control positions.
• Understaffing, which could lead to incompatible control duties being assigned to one person or important control responsibilities being neglected due to heavy workload. • New legislation exposing the City to heightened legal liability or risk of loss. • Technological advances that impact the City’s risk.
• Publication of new accounting principles impacting the City. • Findings or comments from the external auditor.
• Decline in the broader economy, which may subject the City to both internal and external pressures
Procedure
At least annually, and more frequently as conditions demand, the Finance Department will consider whether any of the above triggers have caused changes in the City’s risks and determine whether changes in procedures may be necessary to ensure that the system of internal control continues to effectively serve its purpose of providing reasonable assurance that the financial statements are fairly stated in accordance with generally accepted accounting principles and the City’s assets are appropriately safeguarded.
The Finance Department will also conduct a comprehensive risk assessment on a periodic basis where the risks related to each significant class of transactions and balance sheet account will be identified, and operating procedures will be evaluated to determine the extent to which those risks are mitigated.
RISK ASSESSMENT
Item 8.4
Mountain House Page 732 of 984 7 Section 210200
OVERVIEW
Along with the following documents, the policies and procedures set forth in this chapter form the City's purchasing system:
• Ordinance Chapter 2 of Division 2 of Title 2 of the Mountain House Municipal Code MH-2 (NoOrd. 2024-20XX)
• Sections 54201 et seq. of the Government Code
• Sections 22000 et seq.20680 -– 20683 and 22150-22154 of the California Public Contract Code • Sections 4526 et seq. of the Government Code
• Title 14 of the California Code of Regulations, Section 18993.3(b) • Caltrans Local Assistance Procedures Manual (LAPM), Chapter 10 The purpose of this chapter is to guide staff members in purchasing goods and services on behalf of the City by establishing responsibilities and authorization levels and setting forth the policies and procedures that govern purchasing activities.
These guidelines are not intended to address every issue, exception or contingency that may arise in the course of purchasing activities. Accordingly, the basic standard that should always prevail is to exercise good judgment in the use and stewardship of City resources.
PURCHASING SYSTEM OBJECTIVES
This system has been developed in order to achieve the following objectives:
• Secure goods and services at the lowest cost possible commensurate with quality requirements.
• Establish authority, responsibility and accountability for purchasing activities conducted on behalf of the City.
• Ensure competition and impartiality in all purchasing transactions to the maximum extent possible.
• Standardize procedures where appropriate to ensure that organization-wide policies and goals are achieved.
• Maintain department responsibility, initiative and flexibility in evaluating, selecting and purchasing goods and services.
• Implement simple yet effective internal control procedures that appropriately support planning, maximize productive use of public funds and protect City assets from unauthorized use.
• Comply with applicable state law requirements relating to the purchase of recycled-content paper.
PURCHASING AUTHORITY
The City’s Code of Ordinances delegates purchasing authority to the City Manager as well as any other representatives designated by her or him. The City Manager designates the Administrative Services Director=Finance Director as Purchasing Agent with authority over all
PURCHASING
Item 8.4
Mountain House Page 733 of 984 8 City purchasing activities pursuant to the City’s Code of Ordinances. Purchasing responsibilities include:
• Developing and prescribing such administrative policies, forms and files as may be reasonably necessary for the internal management and operation of City purchasing policies and procedures.
• Purchasing or contracting for supplies, equipment, services and construction projects as required by the operating departments in accordance with City purchasing policies and procedures.
• Negotiating and recommending execution of contracts.
• Procuring needed quality in goods and services at minimum expense. • Ensuring as full and open competition as possible on all purchases. • Developing and maintaining department awareness of purchasing and pricing principles, marketing conditions and new products.
• Inspecting supplies and equipment delivered, as well as contractual services performed, to determine their conformance with the specifications set forth in orders and contracts; and, in this connection, having the authority to require chemical, physical or other tests of samples submitted with quotations or bids, or of delivery samplings, which may be necessary to determine quality and conformance with specifications.
• Establishing procedures for, and assigning duties to, staff engaged in receiving, storing and issuing purchased supplies, ensuring that supply levels are consistent with usage requirements.
• Facilitating the transfer of surplus or unused supplies and equipment among departments as needed.
• Selling or exchanging surplus supplies and equipment, provided that they cannot reasonably be used by any department, in compliance with the provisions of Section 440 of this Manual.
PURCHASING ORGANIZATION
Department Heads within the City will be responsible for identifying needs and preparing proposed purchases for the appropriate level of review by the Finance Administrative Services Director or the Finance Department staff member(s) to whom the Finance Administrative Services Director may delegate purchasing authority. The Finance Administrative Services Director or designee will review and approve or reject proposed purchases or, if the purchase meets certain thresholds as outlined below, forward the proposed purchase to the City Council for final approval.
PURCHASING SYSTEM OVERVIEW
Regardless of the type of item or service being acquired, virtually every purchase transaction goes through seven distinct stages in varying degrees:
• Assessing and determining resource needs.
• Developing specifications.
• Soliciting and evaluating quotations, bids or proposals. • Selecting the best proposal.
• Awarding the contract or purchase order and authorizing work to proceed. • Receiving and inspecting goods or services to ensure they conform with specifications. • Paying the vendor when contract terms have been met.
Item 8.4
Mountain House Page 734 of 984 9 RECYCLED-CONTENT PAPER PRODUCTS AND RECYCLEDCONTENT PRINTING AND WRITING PAPER For the purposes of this Manual, the following definitions shall apply:
“Paper Products” shall include, but are not limited to, paper janitorial supplies, cartons, wrapping, packaging, file folders, hanging files, corrugated boxes, tissue, and toweling; or as otherwise defined in 14 CCR 18982(a)(51).
“Printing and Writing Papers” include, but are not limited to, copy, xerographic, watermark, cotton fiber, offset, forms, computer printout paper, white wove envelopes, manila envelopes, book paper, note pads, writing tablets, newsprint, and other uncoated writing papers, posters, index cards, calendars, brochures, reports, magazines, and publications; or as otherwise defined in 14 CCR 18982(a)(54).
"Recyclability" means that the Paper Products and Printing and Writing Paper offered or sold to the City are eligible to be labeled with an unqualified recyclable label as defined in 16 CFR 260.12 (2013).
“Recycled-Content Paper Products and Recycled-Content Printing and Writing Paper” means such products that consist of at least thirty percent (30%), by fiber weight, postconsumer fiber, consistent with the requirements of Sections 22150 to 22154 and Sections 12200 and 12209 of the Public Contract Code, and as amended.
If fitness and quality of Recycled-Content Paper Products and Recycled-Content Printing and Writing Paper are equal to that of non-recycled items, all departments and divisions of the City shall purchase Recycled-Content Paper Products and Recycled-Content Printing and Writing Paper that consists of at least thirty percent (30%), by fiber weight, postconsumer fiber, whenever the total cost is the same or a lesser total cost than non-recycled items or whenever the total cost is no more than five percent (5%) of the total cost for the non-recycled items, consistent with the requirements of the Public Contract Code, Sections 22150 through 22154 and Sections 12200 and 12209, as amended.
All Paper Products and Printing and Writing Paper shall be eligible to be labeled with an unqualified recyclable label as defined in Title 16 Code of Federal Regulations Section 260.12 (2013).
All vendors that provide Paper Products (including janitorial Paper Products) and Printing and Writing Paper to the City shall:
1. Provide Recycled-Content Paper Products and Recycled-Content Printing and Writing Paper that consists of at least thirty percent (30%), by fiber weight, postconsumer fiber, if fitness and quality are equal to that of non-recycled item, available at no more than five percent (5%) of the total cost for non-recycled Paper Products.
2. All vendors providing printing services to the City via a printing contract or written agreement, shall use Printing and Writing Paper that consists of at least thirty percent (30%), by fiber weight, postconsumer fiber, or as amended by Public Contract Code Section 12209.
3. Only provide Paper Products and Printing and Writing Papers that meet Federal Trade Commission Recyclability standard as defined in Title 16 Code of Federal Regulations Section 260.12 (2013).
4. Certify in writing, under penalty of perjury, the minimum percentage of postconsumer material in the Paper Products and Printing and Writing Paper offered or sold to the City.
This certification requirement may be waived if the percentage of postconsumer material in Item 8.4
Mountain House Page 735 of 984 10 the Paper Products, Printing and Writing Paper, or both can be verified by a product label, catalog, invoice, or a manufacturer or vendor internet website.
5. Certify in writing, under penalty of perjury, that the Paper Products and Printing and Writing Paper offered or sold to the City is eligible to be labeled with an unqualified recyclable label as defined in Title 16 Code of Federal Regulations Section 260.12 (2013).
6. Provide records to the Finance Administrative Services Director or designee of all Paper Products and Printing and Writing Paper purchased from the vendor within thirty (30) days of the purchase (both recycled-content and non-recycled content, if any is purchased) made by a division or department or employee of the City. Records shall include a copy of the invoice or other documentation of purchase, written certifications as required in Sections 4 and 5 above for recycled-content purchases, purchaser name, quantity purchased, date purchased, and recycled content (including products that contain none), and if non-Recycled-Content Paper Products and/or non- Recycled-Content Printing and Writing Paper are provided, include a description of why Recycled-Content Paper Products and/or Recycled-Content Printing and Writing Paper were not provided.
The Finance Administrative Services Director or designee will be the responsible for obtaining records pertaining to procurement of Recycled-Content Paper Products and Recycled-Content Printing and Writing Paper and shall perform the following tasks to track procurement of Recycled- Content Paper Products, and Recycled-Content Printing and Writing Paper:
1. Collect and collate copies of invoices or receipts (paper or electronic) or other proof of purchase that describe the procurement of Printing and Writing Paper and Paper Products, including the volume and type of all paper purchases; and, copies of certifications and other required verifications from all departments and/or divisions procuring Paper Products and Printing and Writing Paper (whether or not they contain recycled content) and/or from the vendors providing Printing and Writing Paper and Paper Products. These records must be kept as part of City’s documentation of its compliance with 14 CCR 18993.3.
2. Compile an annual report on the City’s direct procurement, and vendor/other procurement on behalf of the City, of Recycled-Content Paper Products, and Recycled- Content Printing and Writing Paper, consistent with the recordkeeping requirements contained in 14 CCR 18993.4 for Recycled-Content Paper Products and Recycled-Content Printing and Writing Paper procurement. This report shall be made available to the City’s designee responsible for compiling the annual report to be submitted to CalRecycle (which will include a description of compliance on many other SB 1383 regulatory requirements) pursuant to 14 CCR Division 7, Chapter 12, Article 13. The procurement report shall also be shared with the City’s Council annually as evidence of the implementation of this Manual.
REQUIREMENTS BY TYPE AND AMOUNT OF PURCHASE
The type of purchase as well as its estimated cost determine the formality with which each stage is completed and documented. Payments made by the City to outside parties (excluding employee payroll) may generally be classified into the following categories:
Employee reimbursements and travel costs. Employee reimbursements for travel costs incurred on City business and travel costs paid directly by the City are subject to the separate terms of the City’s travel policy and are not subject to this purchasing policy. Employee reimbursements for non-travel costs are subject to all other provisions of this policy where applicable, but ordinarily would not be for items greater than $5,000.
Item 8.4
Mountain House Page 736 of 984 11 Credit card purchases. Credit card purchases are individually subject to the terms of this purchasing policy as well as the credit card policy. The total amount paid to the credit card company on the credit card bill is not considered a single purchase and purchases made on the City’s credit cards are considered purchases directly from the vendor initiating the credit card charge, for purposes of applying the dollar limits of this policy. Accordingly, credit card purchases in excess of $5,000 that are not in an excepted category under this policy require an approved requisition and purchase order prior to purchase, unless the requirement has been waived by the Finance Administrative Services Director due to a purchasing emergency, as defined later.
Utility services. Utility services include electricity, piped-in natural gas, cellular and landline telephone, Internet, water, sewer, and refuse disposal services for the City’s locations. These services are either impossible or impractical put out for bid because only one supplier provides the services for a given location, the services are provided by very large companies on an inflexible basis, or the process of soliciting bids would be of minor benefit in comparison to the cost and personnel time involved. No contracts or competitive bids are required for these services and the Finance Administrative Services Director or designee may approve any amount needed to facilitate the operations of the City. Care should be exercised that the City is billed for service only at City locations and for costs incurred for City business.
Services delivered by San Joaquin County. Other than any approval which may be specifically required by law or ordinance, services delivered by San Joaquin County to the City do not require written contracts or competitive bidding.
Government and regulatory fees. Payments for government and regulatory fees imposed on the City by law and paid to a government agency are not “purchases” and are not subject to this policy.
Rents and leases. All rents and leases must be signed by the City Manager, if $100,000 or less, or approved by the City Council if in excess of $100,000. For all new rent or lease transactions with a total cost of more than $5,000 in any given fiscal year, the Finance Department will complete an evaluation of the proposed transaction to determine:
• Whether a purchase of the item to be rented or leased would be feasible and more financially beneficial to the City.
• Whether the item could be rented or leased from a different source more economically than the source proposed.
This analysis is not required for extensions of existing rent and lease agreements.
All rent and lease contracts must be forwarded to the Finance Department who will maintain a list of these contracts in order to comply with special accounting requirements for leasing transactions.
Long-term debt. Long-term debt is initiated according to the City’s debt management policy and generally requires the approval of the City Council. The Finance Department makes all required payments on all of the City’s properly approved long-term debt.
Construction of buildings, structures, roadways, and improvements. The City Council has adopted a resolution that allows the City to use the California Uniform Public Construction Cost Item 8.4
Mountain House Page 737 of 984 12 Accounting Act (CUPCCAA) for construction projects. All construction projects are governed by the City’s CUPCCAA Bidding and Contracting Procedure which is incorporated into this policy manual, and are not otherwise subject to the requirements of this general purchasing policy. In general, the CUPPCAA bidding and contracting procedure allows for informal contracting procedures for construction projects up to $175220,000, assuming the project has been included in the City’s budget.
Master services agreements and task orders. In some cases the City has an ongoing or frequent need for a particular kind of service such that the total amount to be expended on the service in a fiscal year will exceed the $50,000 purchasing threshold, but the service will be broken up into multiple specific tasks throughout the year as the need arises. In this case, requestors may propose a master services agreement with one or more vendors who provide the service with an agreedupon schedule of rates, a maximum not-to-exceed amount for a period of time, and a provision that work may not be performed until authorized by the issuance of a task order or similar document from the City. If the maximum amount on the proposed master services agreement exceeds the $100,000 Council approval threshold, the master agreement will be subject to the provisions of purchases exceeding $100,000 including competitive proposals/bids or a no-bid justification and approval by the City Council. However, once the master services agreement is approved, work can be authorized by the Department Head via an approved task order without additional Council approval even if the task order exceeds $100,000. In authorizing a task order, the Department Head shall determine that the proposed cost for the scope of work is reasonable under the circumstances in relation to the work being performed. Because the terms of the master services agreement provide that work may not proceed without an approved task order, budget availability will not be required and a purchase order will not be issued until a task order is issued.
The Department Head shall route all authorized task orders to the Finance Department attached to a Master Agreement Tracking Form that lists all previously approved task orders under the master services agreement in question and demonstrates that the issuance of the current task order is within the total Master Services Agreement authorized by the Council. The Finance Department may decline to process vendor invoices if the authorized task order and Master Agreement Tracking Form are not received. If the tasks are truly independent of each other, each task can be treated as a separate purchase at the requestor’s option, and a master services agreement is optional. However, if each task is treated as a separate purchase, these separate purchases will each be subject to the terms of this policy based on their dollar amounts, which could necessitate multiple competitive solicitations and/or Council approvals that would not be necessary under a master services agreement.
Onsite Services. Regardless of the amount, all onsite services require either a contract and/or a purchase order (with terms & conditions attached).
All purchases requiring a written contract. Regardless of amount, if any purchase requires a written contract (other than the standard cardmember agreement signed when making a credit card purchase or a standard purchase order form issued by the City), the proposed contract must be submitted to the Finance Administrative Services Director or designee for review. The City has standard contract language available that has been approved by the City’s legal counsel, and any non-standard contract terms in a proposed contract should be specifically identified for the Finance Administrative Services Director’s review. The Finance Administrative Services Director or designee will expedite the review of standard contracts for small purchase amounts, but for contracts containing deviations from the standard contract language or a large amount, the Finance Administrative Services Director may decide to obtain legal review prior to approval.
Item 8.4
Mountain House Page 738 of 984 13 If approved by the Finance Administrative Services Director or designee, the Finance Administrative Services Director or designee will forward the contract to the City Manager with a recommendation. For construction and capital expenditure contracts up to $175,000 and all other contracts up to $100,000, the City Manager may sign without specific City Council approval of the contract. For contracts in excess of these amounts, the proposed contract must be submitted to the City Council for approval.
Purchases $5,000 or less. For administrative simplicity, purchases of individual items of physical property at $5,000 or less for each item and offsite services provided to the City at a cost of less than $5,000 do not require a written purchase order or contract and may be purchased by a Department Manager or designee inasmuch as there is budget available in an appropriate line item to pay for the product or service purchased. Although competitive bidding is not required, purchasers should exercise their judgment in making purchasing decisions that are in the best interests of the City. If a written contract is deemed necessary or appropriate, the contract must be submitted to the Finance Administrative Services Director or designee who will expedite the request for the City Manager’s signature if the contract contains standard language. See “All purchases requiring a written contract” above for special requirements dealing with written contracts.
All other purchases of goods or off site services totaling more than $5,000 and up to $50,000.
Unless falling into one of the categories above, all purchases of goods or services totaling more than $5,000 and up to $50,000 are subject to the requirements of this paragraph. All such purchases must:
1. Have a written justification of the reasonableness of price prior to the issuance of a purchase order. Such written justification shall either describe the competing quotes or proposals obtained for the service or explain an alternative basis for concluding that the price is reasonable to the City.
2. If the architectural, landscape architectural, engineering, environmental, or land surveying services are being procured, have a written justification of the demonstrated competence and professional qualifications of the vendor.
3. Be approved in advance by the Finance Administrative Services Director or designee. Prior to approving a purchase the Finance Administrative Services Director or designee will verify that sufficient budget exists for the purchase.
4. Be documented on a written purchase order.
Upon approval by the Finance Administrative Services Director or designee, the Department Head Finance may generate the purchase order and Department Head may proceed with the purchase directly if the purchase does not require a contract and the value is more than $5,000 but not more than $1050,000. All purchases over $10,000 and all All written contracts shall be submitted to the City Manager for signature if approved by the Administrative ServicesFinance Director or designee, except for task orders under Master Services Agreements previously approved, which are discussed above.
All other purchases of goods or services in excess of $50,000 and up to $100,000. For a purchase exceeding $50,000 but not above $100,000, either a minimum of three competitive bids, proposals, or statements of qualifications, or a non-bid justification must be provided. See the “Competitive Procurement” section of this policy for further details. City employees must submit either competitive bids or a non-bid justification to the Finance Administrative Services Director or designee, who will review the proposed purchase for compliance with this policy and Item 8.4
Mountain House Page 739 of 984 14 determine whether sufficient budget exists for it. Upon approval, the Finance Administrative Services Director will forward the purchase recommendation to the City Manager. If approved, the City Manager will execute a written agreement with the vendor.
All other purchases in excess of $100,000. All other contracts exceeding $100,000 not in one of the excepted categories above must be submitted to the City Council for approval and require a minimum of three competitive bids, proposals, or statements of qualifications, or an acceptable non-bid justification (see “Competitive Procurement” in this policy). After concluding a competitive procurement or documenting a non-bid justification, the requesting employee submits documentation to the Finance Administrative Services Director or designee as described in the “Required Documents for Purchases Section,” later. Upon approval, the Finance Administrative Services Director will forward the purchase recommendation to the City Manager. If approved, the Department Head Administrative Services Director will schedule the proposed contract for consideration at a City Council meeting, typically no less than 3 weeks after receipt of all required documentation from the requesting department (see “Purchasing Timeframes,” later). If approved by the Council, the City Manager will sign the contract and Finance will approve the purchase requisition.
Unless exempted under the provisions above, all invoices in excess of $5,000 must be linked to a purchase order in order to be processed and paid by the Finance Department.
Splitting of invoices in order to evade purchasing policy thresholds is prohibited (see further discussion of splitting below). No City employee should make any commitment to purchase an item greater than $5,000 on behalf of the City without an approved contract or purchase order.
Employees who make any commitments to a vendor in excess of $5,000 without having a purchase order issued by the City may be held personally liable for vendor charges.
Architectural, landscape architectural, engineering, environmental, and land surveying services. In accordance with Government Code Section 4526, vendors providing architectural, landscape architectural, engineering, environmental, and land surveying services shall be selected based on demonstrated competence and on the professional qualifications necessary for the satisfactory performance of the services required. Any competitive procurements of these services will take these factors into account. In all other respects, purchases of these services will be subject to the terms of this purchasing policy, including the thresholds identified above.
Architectural & Engineering Consultant Procurement Procedures for Projects Funded from State and Federal Sources Provided through Caltrans. The City Council has adopted a resolution that adopts Chapter 10 – Consultant Selection of the California Department of Transportation (Caltrans) Local Assistance Procedures Manual (LAPM), attached hereto as Exhibit 1, as the City of Mountain House procedures for procurement of Architectural and Engineering (A&E) consultant services associated with State and federally funded transportation projects administered through Caltrans. All future updates and revisions to LAPM Chapter 10 are incorporated into the City’s consultant procurement procedures for applicable projects. Under LAPM Chapter 10, the City is required to use a qualifications-based selection process for A&E consultant services. Consultants are selected based on demonstrated experience, technical expertise, and professional qualifications, with cost negotiated after the most qualified firm is identified. LAPM Chapter 10 also establishes standardized procedures intended to ensure transparency, fairness, and accountability in the use of public funds. These include public solicitation requirements, documentation of the evaluation and selection process, preparation of Item 8.4
Mountain House Page 740 of 984 15 independent cost estimates, and compliance with federal requirements related to conflicts of interest, nondiscrimination, and disadvantaged business enterprise (DBE) participation.
Contract end date and total vendor contract amount. All contracts will end on June 30 unless there are significant savings involved with a multiyear contract. Purchase Orders will not rollover annually unless there are extenuating circumstances and approved by the Finance Administrative Services Director. Any contract purchase order that is approved to rollover to the new fiscal year will be included in the total vendor contract amount in the new fiscal year. The Finance Department will reject proposed purchases exhibiting any of the following indicators:
• Vendors with multiple contracts exceeding a total of $100,000 for services within a fiscal year.
• Vendors with multiple vouchers exceeding $5,000 for services within a fiscal year.
Splitting of purchases. Splitting up a purchase into smaller amounts with the intent of pulling the purchase price of each individual component down so that all components fall below one of the thresholds defined in this policy is contrary to the objective of this policy. In practice, however, determining whether a purchase stands alone or is a split-up component of a larger purchase is a matter of judgment. The Finance Department may reject proposed purchases exhibiting the following indicators of splitting:
• Multiple contracts with the same vendor for a similar scope of work. • Separate contracts with the same vendor for different phases of work, all of which must be performed in order for the work product to have any substantial value to the City (except in cases where the City is completing work in phases for budgetary reasons and does not have the budget available at one time to contract for all phases of the work). • Separate contracts or purchases with the same vendor for various physical goods which have limited value to the City unless goods from multiple purchases are physically assembled or combined into one or more physical items, the value of which would exceed a purchasing policy threshold.
Contract Requests and Contract Management. Contracts must be awarded and managed by the Department Manager. Outside vendors and Consultants are prohibited from awarding or managing City contracts.purchases.
CONTRACT / PURCHASE ORDER BREAKDOWN BY AMOUNT
The following table shows when a Purchase Order and/or Contract is required depending on the project cost.
Amount Type PO Required? Contract
Required?
Materials only No No
< $5000 Services, Onsite Yes No
Services, Not Onsite No No
Item 8.4
Mountain House Page 741 of 984 16 Materials only Yes No
$5,000 - $50,000 Services, Onsite Yes YesNo
Services, Not Onsite Yes No
Materials only Yes Yes
>$50,000 Services, Onsite Yes Yes
Services, Not Onsite Yes Yes
WORKFLOWS FOR PURCHASING BY EXPENDITURE AMOUNT
The following table describes the purchasing process for all City purchases except travel costs, utility services, and San Joaquin County services, as defined above. Purchases subject to CUPCCAA are subject to additional requirements, as specified in the related policy.
Note: Splitting of contracts for the purpose of pulling the total contract amount below a purchasing threshold is prohibited. The Administrative ServicesFinance Director may reject a proposed purchase if it is determined that contract splitting has occurred. See “Splitting of purchases,” above.
Item 8.4
Mountain House Page 742 of 984 17 Item 8.4
Mountain House Page 743 of 984 18 Item 8.4
Mountain House Page 744 of 984 19 Item 8.4
Mountain House Page 745 of 984 20 Item 8.4
Mountain House Page 746 of 984 21 Item 8.4
Mountain House Page 747 of 984 22 Item 8.4
Mountain House Page 748 of 984 23 Item 8.4
Mountain House Page 749 of 984 24 COMPETITIVE PROCUREMENT
One of the key objectives of the City’s purchasing policy is ensuring the City and its residents receive goods and services for a fair and reasonable price and that the City procures its goods and services in a fair and open manner under the circumstances. Accordingly, competitive bids, quotes, or proposals are required for purchases that exceed $50,000 unless a non-bid justification is documented and approved.
METHODS OF PROCUREMENT
The City may use 4 general methods of procurement depending on the circumstances.
Competitive Bids
• Used for goods or services when price is the primary deciding factor. • Contract is awarded to the lowest responsive and responsible bidder. • Solicitations for bids should specify the minimum qualifications for bidders. • Solicitations for bids should include sufficient details so that bid responses will be comparable.
• Shall not be used for architectural, landscape architectural, engineering, environmental, and land surveying services, as these services require an evaluation of proposer competence.
Value Procurement
• Used for goods or services when price is one among multiple objectively quantifiable deciding factors.
• Contract is awarded to the bidder who provides the overall best value to the City, which is defined as the combination of objectively quantifiable attributes that is expected to best achieve the City’s objectives for the procurement and be in the best interests of the City’s citizens.
• Value procurement may be useful when, for example,
o The quality of the good or service to be purchased makes a significant difference in value to the City.
o The experience or qualifications of the individuals to perform the proposed service makes a significant difference in value to the City, but the City wishes to consider proposals from bidders with varying levels of experience or qualifications and evaluate them in relation to price.
o The City has a substantive need for the good or service to be delivered on an expedited timeline and wishes to award preference to those bidders who can deliver more quickly. • Solicitations for bids or proposals must specify in detail the selection criteria and the relative weight of the factors to be considered in determining overall best value. • Shall not be used for projects requiring formal bidding under the City’s CUPCCAA policy, as current law on formal bids does not permit the use of this method. It may be used on informal bids subject to CUPCCAA only if the method otherwise complies with the informal bidding procedures permitted under the CUPCCAA policy and applicable law.
Requests for Proposals
• Used for services when non-price considerations such as proposer qualifications and competence are significant deciding factors.
Item 8.4
Mountain House Page 750 of 984 25 • Preferred method for professional consulting services unless a request for qualifications / master services agreement will be used, as discussed below, since the selection of a professional consultant should consider qualifications. • Request for Proposals document is circulated that includes:
o A description of the scope of work
o A description of any minimum qualifications necessary for a successful proposal o Designation of a single City representative as point of contact for proposers o A description of the criteria on which the proposals will be evaluated and the relative importance of each criterion
o A requirement that proposers include references
• A selection committee of City representatives rates proposals received according to the criteria specified in the request for proposals to determine a ranking of the proposals received. • Negotiations begin with the proposer who scored the highest. If an acceptable contract cannot be negotiated with that proposer, negotiations will begin with the next-highest proposer.
Requests for Qualifications/Master Services Agreement
• Used when the City will have an ongoing need for a significant amount of a particular type of professional or specialized service that can be divided into discrete tasks. • Request for Qualifications is circulated that includes o A general description of the type of services needed by the City. o A requirement for interested firms to submit statements of qualifications demonstrating their relevant experience, competence, and billing rates that would be charged in performing the services
o Designation of a single City representative as point of contact for proposers o A description of any minimum qualifications
• A selection committee will review the received statements of qualifications and determine which proposers meet the City’s criteria for the work to be performed. • For those meeting the criteria, the City may execute master services agreements with appropriate approval by the Council that provide that the City may subsequently approve task orders with specific scopes of work with the approved vendors. No work may begin without an approved task order.
Requirements applicable to all solicitations for bids/proposals/SOQs. The following requirements apply to the solicitation of competitive bids, proposals, or statements of qualifications:
• Written solicitations for competitive bids or proposals should incorporate a clear description of the goods or services to be procured and should avoid unnecessary restrictions that may limit competition such as the specification of a particular brand name. The clarity required depends on the circumstances. In cases where the City is issuing a request for qualifications for firms to be considered for a variety of projects on an on-call list, the description will necessarily be more general.
• Solicitations should be posted on the City’s website and circulated to potential bidders/proposers and should allow sufficient time for an adequate response if appropriate given the urgency of the City’s need for the good or service. Unless the need is urgent, a minimum of 3 weeks should generally be allowed for bids/responses. • All potential bidders/proposers should be given an equal opportunity to seek clarifying and additional information about the City and the solicitation. During the time a solicitation is under way, potential bidders/proposers should limit their contact with the City regarding the Item 8.4
Mountain House Page 751 of 984 26 solicitation to the individual identified as the contact person for the solicitation. • A contract shall not be awarded to a proposed vendor if a City representative or employee with a conflict of interest in the procurement, such as a close family connection or a material financial interest in the proposed vendor, participated in the selection process.
Non-bid justifications. Acceptable non-bid justifications include, but are not limited to:
• The contract with the vendor has been previously put out to bid and there is either no change in cost from the previous bid price or the change is fair and reasonable in the circumstances. • The vendor provides a service that requires significant knowledge of the City’s specific operations and the potential cost of onboarding a new vendor is judged to be greater than the benefit received by competitive bidding. However, this justification may only be used to award a new contract to a vendor for a particular service if the previous contract with that vendor for the service in question had been awarded under a competitive procurement. Accordingly, a non-bid justification based on a vendor’s existing knowledge of the City’s operations may only be used once every other year if the contracts are awarded on an annual basis. After the justification is used for a particular vendor and service, a competitive procurement must be conducted before the justification can be used again.
• The good or service needed by the City is of a highly specialized nature and there are few, if any, competitors in the market to provide the good or service. • The City has recently attempted to put the service out for bid or proposals but has failed to receive at least 3 qualified proposals despite adequate circulation. • Cooperative and “piggyback” purchasing. The good or non-construction service is available through a contract that was competitively solicited and awarded by another public agency either contracting directly or acting as the lead agency for a cooperative purchasing organization. To rely on this justification, each of the following must be documented, subject to the approval thresholds otherwise applicable to a purchase of the same dollar amount: (1) the lead agency or cooperative and specific contract number being used; (2) confirmation that the contract was awarded through a competitive process that is substantially consistent with the competitive principles of this policy and consistent with state laws; (3) confirmation that the contract by its terms permits use by other public agencies or that the vendor has agreed in writing to extend the same or more favorable pricing and terms to the City; (4) that the contract covers the same or nearly the same goods or services the City is purchasing; (5) a determination that the pricing is fair and reasonable to the City; and (6) confirmation that the contract is currently in effect. This justification may not be used for public works projects, including the labor or installation component of any purchase that would constitute a public work.
REQUIRED DOCUMENTS FOR PURCHASES
In order to ensure timely processing of all purchase requests, requestors should ensure their requests include all required documents when submitting to the Finance Department. The following describes the documents required for each purchasing level:
• Under $5,000
o No purchase order required for materials or off site services. Vendor or credit card company submits invoice for payment under normal payment process. • Task Orders Under Master Services Agreements
o Task order signed by Department Head.
o Justification of the reasonableness of price.
o Master Agreement Tracking Form listing all task orders approved under the master Item 8.4
Mountain House Page 752 of 984 27 services agreement to date and demonstrating that the current task order does not cause the total to exceed the agreement amount.
• $5,000-$50,000
o Requisition identifying the items to be purchased, vendor, and proposed pricing or proposed contract signed by vendor.
o Identification of any non-standard contract language requested. o Written justification that the price offered by vendor is reasonable or that the vendor is the only one reasonably available to provide the good or service. o For architectural, landscape architectural, engineering, environmental, and land surveying services, a written justification of the demonstrated competence and professional qualifications of the vendor for the work to be performed. o GL Account Code to be charged with the expense.
o Up-to-date insurance certificates from the vendor.
o Current valid business license for the vendor.
o New vendor packet if applicable.
• Over $50,000
o Requisition identifying the items to be purchased, vendor, and proposed pricing or proposed contract signed by vendor.
o Identification of any non-standard contract language requested. o Copies of 3 competing quotes or proposals for the product or service or a non-bid justification.
o For architectural, landscape architectural, engineering, environmental, and land surveying services, a written justification of the demonstrated competence and professional qualifications of the vendor for the work to be performed, if not otherwise addressed in the proposal or bid material.
o GL Account Code to be charged with the expense.
o Up-to-date insurance certificates from the vendor.
o Current valid business license for the vendor.
o New vendor packet if applicable.
o Additional item specified below if the contract exceeds $100,000 or $175,000 if it is a capital expenditure or construction contract.
• Over $100,000 ($175,000 for capital expenditures and construction contracts) o All of the requirements for purchases over $50,000 above, plus:
o Draft staff report to be presented to the City Council explaining the purchase.
PURCHASING TIMEFRAME
Except in cases of emergency at the discretion of the Administrative ServicesFinance Director, no purchase may be made nor may work commence for purchases of $5,000 or more until the Finance Department approves a requisition and the requestor issues a Purchase Order using Tyler Incode under this policy. Unless the total purchase is under $5,000 or an exception is granted, invoices from vendors showing work performed or goods shipped prior to the purchase order date will be returned unpaid.
Except in cases where there are complications or problems with the proposed purchase, the Finance Department will issue Purchase Orders under the following timelines, if the submission by the requestor includes all required information and the purchase is approved:
Item 8.4
Mountain House Page 753 of 984 28 • Purchases of $5,000 to $100,000 ($175,000 for capital expenditure and construction contracts): Decision on requisition 5 business days after receipt of the proposed purchase from the requestor.
• Purchases in excess of $100,000 ($175,000 for capital expenditure and construction contracts): Approved requisition 20 business days after receipt of the proposed purchase from the requestor, if the request is submitted exactly 3 weeks prior to a scheduled City Council meeting and the Council, Finance, the City Manager, and any other authority approve the proposed purchase. Purchase requests submitted less than 3 weeks prior to a Council meeting will be delayed until the next Council meeting, unless an exception is approved by the Administrative ServicesFinance Director.
Emergencies. From time to time, the City may encounter a purchasing emergency. A purchasing emergency is defined as a situation in which a purchase is needed immediately and adherence to the normal purchasing timelines as defined above is expected to result in injury to persons or property or substantial additional cost to the City. However, the Finance Administrative Services Director may exclude situations from the definition of a purchasing emergency if the situation was known to City personnel far enough in advance for those personnel to have addressed the situation within the normal purchasing policy timelines. Requestors who become aware of purchasing emergencies should notify the Finance Administrative Services Director as soon as they become aware of the emergency, as failure to do so may result in emergency claims being denied. In cases of purchasing emergency, the Finance Administrative Services Director may expedite purchasing timelines, waive requirements, and/or schedule additional City Council meetings as necessary to address the emergency.
INSURANCE REQUIREMENTS
For any onsite services, the City will require, as a condition of contract, that the vendor maintain the following insurance coverages if the City is exposed to risk in these areas:
• For contracts where work will be done on or to the City’s property, commercial general liability coverage with a limit of $2,000,000 or more per occurrence and $4,000,000 or more in the aggregate limit of $1,000,000 or more per occurrence and in the aggregate. • For contracts involving professional services where an error or omission in the service could result in significant loss to the City, professional liability coverage with a limit of $1,000,000 or more per occurrence and in the aggregate. • For contracts for services with vendors who have employees, worker’s compensation and employer’s liability coverage in the amount statutorily required.
PURCHASE ORDERS AND REQUIREMENTS FOR VENDOR
INVOICING
Requestors will issue all purchase orders under this policy from the Tyler Incode system after Finance approves the purchase requisition, which will result in the reduction of available budget if the purchase is to be made from budgeted funds (purchases made from developer funds are not budgeted).
Each purchase order shall be issued with an expiration date which, in most cases, should not be beyond the end of the fiscal year, though exceptions may be approved on a case-by-case basis by the Finance Administrative Services Director or designee. Any invoice for work performed or Item 8.4
Mountain House Page 754 of 984 29 goods delivered after the expiration date of a purchase order will be returned unpaid unless an exception is approved by the Finance Administrative Services Director or designee. City employees needing to extend the expiration date on a purchase order should contact the Finance Department to request the extension prior to the expiration date.
Each purchase order shall contain the following requirements for vendor invoicing:
• Vendor invoices must include the purchase order number. • Vendor invoices should be submitted to a centralized e-mail address maintained by the Finance Department or by mail to the attention of Accounts Payable at the City’s Office. • Vendor invoices for work performed or goods delivered within a fiscal year must be submitted within 45 days of the end of the fiscal year in which the work was performed.
Item 8.4
Mountain House Page 755 of 984 30 Section 220
Projects from $0 - $4575,000
For all construction jobs from zero ($0) up to and including seventyforty-five thousand dollars ($4575,000) City of Mountain House shall utilize the following procedures.
1. The Public Works Department will have the discretion to select from the list of prequalified contractors, any contractor they deem to be in the best interest of the City, and have a written quote submitted from them.
2. Upon selection of the contractor as well as the submission of their quote, administrative staff will draft and have the contractor execute the “CONTRACTOR – Standard Consultant Agreement.”
3. Contractor will be required to submit current W-9, business license and Certificate of Insurance.
4. Administrative staff will submit proposed contract to the Finance Department and obtain the approval of the Finance Department that the contract is within the adopted budget. The contract should be submitted at least 5 business days prior to the desired start date for the work.
5. If approved, the Administrative ServicesFinance Director or designee will obtain City Manager signature/approval upon receipt of executed contract from vendor.
6. Once all required documents have been received, and the Agreement is fully executed, administrative staff shall return to the contractor a fully executed copy of the Agreement along with the Purchase Order. This combination of documents will be considered the Notice to Proceed, contingent upon direction by the Public Works Department
7. Administrative staff will submit the required PWC-100 through the DIR website for construction projects in excess of $25,000 and maintenance projects in excess of $15,000.
8. Contractor is required to submit payment bond for all projects in excess of $25,000 prior to commencement of work.
Projects from $4575,001 - $175220,000
For all jobs from fortyseventy-five thousand and one dollars ($4575,001) through one two hundred seventy fivetwenty thousand dollars ($175220,000) City of Mountain House shall utilize the following “Informal Bidding” procedures.
1. The Public Works Department will issue a notice to pre-qualified contractors inviting them to provide estimates by the specified date and time as follows:
a. Only those pre-qualified vendors within the applicable trades will be notified. b. “Notice Inviting Informal Bids” shall be delivered to pre-qualified vendors at least 14 calendar days in advance of submission deadline. (exhibit A) i. The notice must describe the project in general terms, state the time and place for submission of bids and describe how to obtain more detailed information about the project.
c. All projects will be assigned a “Job #” that is unique to that project.
2. The lowest submitted estimate shall be awarded the contract by the City. a. Upon award, the contractor will be required to execute the “CONTRACTOR – Standard Consultant Agreement.”
CONSTRUCTION BIDDING AND CONTRACTING UNDER CUPCCAA
Item 8.4
Mountain House Page 756 of 984 31 b. Upon award, the contractor will be required to submit current W-9, business license and Certificate of Insurance.
c. The proposed contract will be submitted to Finance to verify the contract is within the adopted budget. The contract should be submitted at least 5 business days prior to the desired start date for the work.
d. If approved, the Administrative ServicesFinance Director or designee will obtain City Manager signature/approval upon receipt of executed contract from vendor. e. Once all required documents have been received, and the Agreement is fully executed, administrative staff shall return to the contractor a fully executed copy of the Agreement along with the Purchase Order. This combination of documents will be considered the Notice to Proceed, contingent upon direction by the Public Works Department. f. Administrative staff will submit the required PWC-100 through the DIR website. g. Contractor is required to submit payment bond prior to commencement of work.
3. In the event that all bids received exceed $175220,000, and the City determines that the cost estimate was reasonable, the City may award the contract up to $187,500235,000 to the lowest responsible bidder. The contract must be approved by Resolution of the Council adopted by a four-fifths (4/5) vote with a finding that the City’s cost estimate was reasonable.
Projects in excess of $175220,000 shall be let to contract by formal bidding procedures.
Splitting of purchases. Splitting up a purchase into smaller amounts with the intent of pulling the purchase price of each individual component down so that all components fall below one of the thresholds defined in this policy is contrary to the objective of this policy. In practice, however, determining whether a purchase stands alone or is a split-up component of a larger purchase is a matter of judgment. The Finance Department may reject proposed purchases exhibiting the following indicators of splitting:
• Multiple contracts with the same vendor for a similar scope of work • Separate contracts with the same vendor for different phases of work, all of which must be performed in order for the work product to have any substantial value to the City (except in cases where the City is completing work in phases for budgetary reasons and does not have the budget available at one time to contract for all phases of the work) • Separate contracts or purchases with the same vendor for various physical goods which have limited value to the City unless goods from multiple purchases are physically assembled or combined into one or more physical items, the value of which would exceed a purchasing policy threshold
Emergencies. In cases of emergency where repairs or replacements are needed immediately and the delay caused by following the procedures under this policy could cause significant harm, the Administrative ServicesFinance Director should be notified immediately. The Finance Administrative Services Director will consult with the City Manager, who, if delegated authority pursuant to Public Contract Code section 22050(b)(1) may let the contract without bidding procedures provided that the action is reported to the City Council no later than 7 days after the action is taken, or 14 days if at the next regularly scheduled meeting. The report shall include reasons justifying why the emergency will not permit a delay resulting from a competitive solicitation for bids and why the action is necessary to respond to the emergency. The Council must then vote by a 4/5 vote to continue the action if warranted. If the Council has not delegated this authority to the City Manager, the Council itself must cause to be noted in the minutes to a meeting the reasons the emergency will not permit a Item 8.4
Mountain House Page 757 of 984 32 delay resulting from a competitive solicitation for bids and why the action is necessary to respond to the emergency and must then approve the action by a 4/5 vote before a contract may be let outside of the competitive bidding process.
Item 8.4
Mountain House Page 758 of 984 33 CITY OF MOUNTAIN HOUSE
NOTICE INVITING INFORMAL BIDS
NOTICE IS HEREBY GIVEN that City of Mountain House, will accept sealed Bids for award of a Contract for project # .
The Project requires the following license(s) . The project is anticipated to be calendar days.
Bids are due at , on . It is each Bidder’s sole
responsibility to ensure their bid is timely delivered and received at the locations designated below. Any bid received after the scheduled closing time for receipt of bids shall be returned to the bidder unopened.
City of Mountain House, Public Works Department, 251 E. Main Street, Mountain House, CA 95391.
CUPCCAA: This project is being let in accordance with the California Uniform Public Construction Cost Accounting Act (“CUPCCAA”) set forth in Public Contract Code section 22000 et seq. Bidders shall comply with any requirements set forth in the CUPCCAA including all guidelines and requirements in the current California Uniform Construction Cost Accounting Commission Accounting Policies and Procedure Manual.
Qualified Contractor’s List for Calendar Year: Bids will not be accepted if a Contractor has not been added to the Qualified Contractor List for the current calendar year. The application to be considered for the list is available on the City website (see link below). Incomplete applications will be returned to the contractor. Contractor must submit a complete application 5 days prior to the bid opening. https://www.mountainhouseca.gov/departments/public-works-department/bid-opportunities Mandatory Job Walk and/or Pre-Bid Conference: on at
. Any Contractor bidding on the Project who fails to
arrive on time, sign in and attend the entire mandatory job walk and/or conference will be deemed a nonresponsive Bidder and will have their Bid returned unopened.
To obtain Bid Documents: The bid documents will be available beginning 8:00 a.m. on the City website (see link below). All addenda will be available to interested Contractors, and Bidders responsible to check the website for addenda issued prior to submitting their bids. https://www.mountainhouseca.gov/departments/public-works-department/bid-opportunities For additional information, please contact via email or via phone .
Prevailing Wages: This is a public work project. The Contractor and all Subcontractors (of any tier) must be currently registered and qualified to perform public work in accordance with Labor Code section 1725.5.
Unless specifically exempted by the Labor Commissioner for this Project, the Contractor and all Subcontractors shall furnish certified payroll record as required pursuant to Labor Code section 1776 directly to the Labor Commissioner in accordance with Labor Code 1771.4 on at least a monthly basis (or more frequently if required by the City or Labor Commissioner) and in a format prescribed by the Labor Commissioner for this Project, monitoring and enforcement of the Prevailing Wage laws and related requirements will be performed by the Labor Commissioner/Department of Labor Standards Enforcement (DLSE).
END OF NOTICE
Item 8.4
Mountain House Page 759 of 984 34 Section 230
City of Mountain House shall create and maintain a list of prequalified Contractors for all transactions between zero ($0) and one two hundred seventy-five twenty thousand dollars ($175220,000) in the following manner. (exhibit A)
1 Annually in November, the Public Works administrative department shall create and maintain a list of Prequalified Contractors as follows.
a. A written notice shall be published in all construction journals specified by the CUPCCAA Commission, as well as any other locations that the Public Works Department deems appropriate. (exhibit B)
b. The City’s publication shall invite all licensed contractors to submit their prequalification application to Public Works administration department. (exhibit C) c. The Public Works Department will review contractors that meet predetermined State and City acceptance criteria for inclusion on the list of qualified bidders for each calendar year.
i. Acceptance criteria: Contractor must have valid CSLB license and be currently registered with the DIR as a Public Works Contractor.
d. This list of contractors will be identified according to categories of work. 2 At the completion of the calendar year, the list will be deemed completed, and a new list will be prepared in the same manner to begin on January 1st of the next calendar year. 3 Contractors may at any time during a calendar year request to be added to the list of prequalified contractors.
Construction Journals to be notified, as specified by the Commission:
1. Construction Billboard
(Ebidboard) 11622 El Camino
Real, #100
San Diego, CA 92130
Phone: 800-479-5314
Email:
[email protected]
Website: www.ebidboard.com
2. Dodge Data & Analytics
830 Third Avenue, 6th
Floor New York, NY
10022
Phone: 877-784-9556
Email:
[email protected]
Website: www.construction.com
3. Builders Exchange of
Stockton 7500 West Lane
Stockton, CA 95210
209-478-1000
Email:
[email protected]
Website: www.besonline.com
4. Valley Builders Exchange,
Inc. 1118 Kansas Avenue
Modesto, CA 95351
Phone: 209-522-9031
Email: [email protected]
Website:
www.valleybx.com
Updated 4/18/18 kg
CONSTRUCTION CUPCCAA CONTRACTORS LIST PROCEDURE
Item 8.4
Mountain House Page 760 of 984 35 EXHIBIT A
City of Mountain House
CUPCCAA Contractor List
Updated 04/19/2018
Company Address Contact Phone # Email License Number License Classes Expires ABC Construction 111 Main Street
Tracy, CA 95376
John Doe 209-833-1111 [email protected]
123456
A (General Engineering Contractor),
C-10 (Electrical Contractor)
4-09-2019
Do Right Concrete 123 First Street
Livermore, CA 94550
Dudley Doright 925-333-9898 [email protected] 654321 A (General Engineering Contractor), B (General Building Contractor), C-8 (Concrete Contractor)
12-31-2018
Item 8.4
Mountain House Page 761 of 984 36 EXHIBIT B
CITY OF MOUNTAIN HOUSE
California Uniform Public Construction Cost Accounting Act (CUPCCAA) Notice Inviting Interested Contractors for the 2018 2026 Informal Bid List In accordance with the State of California Uniform Public Construction Accounting Commission, City of Mountain House (“City”) is inviting all interested licensed contractors to submit their company for inclusion on the City’s Informal Bidding Contractors List for the calendar year of 202618.
Per California Public Contact Code section 22032, any Public Works Project that is estimated to be below
$175220,000 is subject to the Informal Bidding Procedures set forth by the State of California Uniform Construction Cost Accounting Commission. All trade categories are subject to Informal Bidding Procedures.
Contractors that are interested in being on the 2018 2026 Bidding Contractors List are required to have a current State oOf California Contractors license in the appropriate classification and are subject to verification through the Contractors State License Board.
Additionally, pursuant to SB 854, no contractor or subcontractor may be listed on a bid for a public works project unless registered with the Department of Industrial Relations (DIR) and no contractor or subcontractor may be awarded a contract for a public works project unless registered with the DIR per California Labor Code section 1725.5. http://www.dir.ca.gov/PublicWorks/PublicWorks.html Licensed contractors interested in being placed on the City’s Informal Bidding Contractors List must complete the City’s “Contractor’s Pre-Qualification Application for the CUPCCAA Informal Bidding Process”. This form may be obtained by visiting the City’s website located athttps://www.mountainhouseca.gov/departments/public-works-department , and should be submitted via email to: [email protected]
If you need additional information, you may visit the City’s website at https://www.mountainhouseca.gov/departments/public-works-department or direct questions via email to: [email protected] or via phone 209-831-5617.
Item 8.4
Mountain House Page 762 of 984 37 EXHIBIT C
CITY OF MOUNTAIN HOUSE
CONTRACTOR'S PRE-QUALIFICATION APPLICATION FOR THE CALIFORNIA UNIFORM
PUBLIC CONSTRUCTION COST ACCOUNTING ACT INFORMAL BIDDING PROCESS
THE CONTRACTOR LISTED BELOW REQUESTS TO BE INCLUDED IN C I T Y O F MOUNTAIN HOUSE'S QUALIFIED CONTRACTOR'S LIST TO RECEIVE NOTICE INVITING INFORMAL BIDS:
Name of Company:
Address:
Telephone: Fax:
Email: Attn:
CA Contractor's License No: Classifications:
DIR Registration No: DIR Expiration Date:
GENERAL ENGINEERING (“A”) AND/OR GENERAL BUILDING (“B”) CONTRACTORS SHOULD
SPECIFY THOSE CATEGORIES OF WORK IN WHICH THEY HAVE A SPECIALIZED KNOWLEDGE
AND SKILL, AND IN WHICH THEY WOULD BE INTERESTED IN PARTICIPATING IN AN INFORMAL CONTRACTING PROJECT WITH THE CITY OF MOUNTAIN HOUSE.
SPECIALIZED CATEGORIES OF WORK
APPLICATION CERTIFICATION:
I CERTIFY THAT TO THE BEST OF MY KNOWLEDGE, THE ELEMENTS OF INFORMATION PROVIDED ABOVE ARE ACCURATE AND TRUE, AS OF THIS DATE. I AM PROPERLY LICENSED AND SKILLED TO PERFORM THE ABOVE WORK AND AM ABLE TO SECURE BONDS TO PERFORM THE WORK. MY COMPANY SHALL COMPLY WITH ALL CITY, STATE AND FEDERAL REQUIREMENTS.
PRINT NAME TITLE SIGNATURE
Incomplete applications will not be accepted. Please complete application and return to:
City of Mountain House., Public Works Dept., 251 E. Main St., Suite 100, Mountain House, CA 95391
OR SUBMIT VIA EMAIL: [email protected]
Item 8.4
Mountain House Page 763 of 984 38 Section 240
OVERVIEW
The purpose of this policy is to set forth the ethical standards of professional behavior expected of all officials and employees conducting purchasing activities on behalf of the City.
STANDARDS OF CONDUCT
Every employee or official engaging in purchasing activities on behalf of the City is required to employ the following standards of conduct:
• Consider, first, the interests of the City in all transactions. • Carry out the established policies of the City.
• Buy without prejudice, seeking to obtain the maximum value for each expenditure of public funds.
• Subscribe to and work for honesty and truth in buying and selling, and to denounce all forms and manifestations of commercial bribery.
• Cooperate with all organizations and individuals engaged in activities designed to enhance the development of purchasing practices.
• Respect obligations to others and require the same respect from others for their obligations.
PROHIBITED PRACTICES
The following practices are specifically prohibited in performing purchasing activities on behalf of the City:
• Having a financial or personal beneficial interest (directly or indirectly) in any contract or purchase order for supplies, equipment, services, or projects furnished to the City. • Accepting or receiving (directly or indirectly) from any person, firm, or corporation to whom any contract or purchase order may be awarded (by rebate, gift or otherwise) any money or anything of value, or any promise, obligation or contract for future reward or compensation.
Gifts and meals received by City employees are exempt from this prohibition and permitted if the total value gifts and meals received by each employee from a single source is no more than $150 in any one fiscal year.
• Using information available to officials and employees, solely because of their City position, for personal profit, gain or advantage.
• Directly or indirectly furnishing services or information not available to all prospective bidders to any person or firm bidding on, or who may reasonably be expected to bid on, a contract with the City.
• Providing confidential information to persons to whom issuance of such information has not been authorized.
• Using a position or status in the City to solicit (directly or indirectly) business of any kind; or to purchase products at special discounts or upon special concessions for personal private use from any person or firm who sells or solicits sales to the City. • Serving the interests of any organization (either as an officer, employee, member of the City Council, or in any capacity for consideration) which transacts or attempts to transact business with the City for profit when such employee holds a City position of review or control—even though remote—over such business transactions.
ETHICAL STANDARDS OF CONDUCT
Item 8.4
Mountain House Page 764 of 984 39 RESPONSIBILITY
Employees. Each employee is responsible for following these practices. Violation of this policy may result in disciplinary action, termination of employment or criminal prosecution.
Department Managers. Department managers are responsible for ensuring that all employees of their department who conduct purchasing activities possess a thorough understanding of these standards of ethical conduct and prohibited practices.
Item 8.4
Mountain House Page 765 of 984 40 Section 250
CITY CREDIT CARDS
OVERVIEW
Purpose
These guidelines establish the City’s basic policies and procedures for using credit cards in making supply and service purchases on behalf of the City and paying for travel expenses when on City business.
City Use Only. City credit cards are for official business use only. Charging personal expenses, even if the intent is to reimburse the City later, is prohibited. Doing so may result in disciplinary action, including, but not limited to, cancellation of the credit card issued to the employee or a negative performance evaluation.
Shared Credit Card Use. Employees are prohibited from using another employee’s credit card.
Employees who need purchasing authority should be issued their own cards after completing required training and signing a cardholder agreement.
Objectives
By using credit cards instead of other payment options we:
• Reduce procurement and payment processing costs.
• Improve vendor relations by making “doing business” with the City easier. • Enhance internal control by better identifying specific employees making supply and service purchases on behalf of the City, and improving the accuracy of account distributions between programs and projects.
• Take advantage of cost-saving opportunities by purchasing on the Internet and through catalogs.
Internal Control Concerns
While credit cards provide a cost-effective alternative for purchasing supplies and services and paying for authorized travel expenditures, the potential for abuse may offset any benefits that they offer. The primary responsibility for ensuring the appropriate use of credit cards lies with each employee assigned a card. Department managers are responsible for ensuring that employees are aware of their responsibilities and for implementing appropriate review and payment procedures within their department.
Some level of risk is inherent in credit card use in conducting City business, however, there are also significant advantages. With reasonable internal controls and exercise of good judgment by cardholders, these advantages outweigh the underlying potential for abuse.
Item 8.4
Mountain House Page 766 of 984 41 POLICIES
• The Finance Department issues City credit cards to regular employees as approved by the department managers. Department managers may set credit card limits and “per transaction” limits at their discretion.
• Credit cards should never be used to circumvent established competitive purchasing procedures. This means no purchases for goods or services should be made in excess of the threshold amount that would otherwise require competitive bidding unless such requirements have been met.
• Credit cards may be used in paying for travel expenses. However, the City’s Travel Guidelines still apply to all such credit card payments, including the use of Travel Authorizations and per diem amounts.
• Employees will not use City credit cards for personal expenses even if the intent is to reimburse the City later. Charging personal expenses on City cards is a misuse of City funds and a serious breach of the City’s ethics policy. Doing so - even if the intent is to reimburse the City later - may result in disciplinary action, up to and including termination.
Cardholders who discover accidental personal charges on the City credit card must declare the charges and immediately reimburse the City.
Note: Including minor incidental expenses as a component part of a larger billing - such as personal telephone calls or video rentals on a hotel bill - is allowed if reimbursed at the time the credit card billing is submitted for payment.
Standard Way of Doing Business. Using credit cards is no longer a “special way” of purchasing supplies and services on behalf of the City; for many purchases, it has become the standard way of doing business. For those employees assigned City credit cards, purchasing supplies and services on behalf of the City is an integral part of their job duties; and failure to follow City policies and procedures regarding the use of City cards is no different from failure to follow policies and procedures in any other aspect of their job.
PROCEDURES
Requesting Credit Cards. Department managers should submit credit card requests to the Finance Department (via memorandum or email) to approve cardholders and set credit card limits, if so desired. The Finance Department retains the discretion to approve or deny requests for employee credit cards.
Criteria. Credit cards are only issued to regular employees. Department managers should consider the following factors in approving credit cards for their staff and setting credit limits:
• Ability to hold the employee accountable for purchases made on the card. • Recognition that delegating authority to an employee to purchase via credit card is not conceptually different from delegating authority to them to purchase from an open contract on a vendor account.
Item 8.4
Mountain House Page 767 of 984 42 • Frequency of use, diversity of vendors and dollar value of purchases made by the employee.
Cardholder Agreement. Before receiving a credit card, employees must sign a “credit cardholder use agreement” (Exhibit A) setting forth their obligations under this program.
No purchases in excess of $10,000. Individual purchases on a City credit card in excess of $10,000 are not permitted unless they are in one of the excepted categories identified in the Purchasing Policy as not requiring a requisition and PO or if an exception is approved by the Finance Administrative Services Director, as in the case of a purchasing emergency.
Timely Payment. Department managers are responsible for ensuring that each credit card statement (along with appropriate supporting documentation reconciled to the statement) is submitted to the Finance Department for payment in a timely manner. Payments must be made timely to avoid administrative charges and late fees.
Disputed Charges. Cardholders are responsible for ensuring that the vendor and issuing bank are notified immediately of any disputed charges. Departments should pay the statement in full - including any disputed amounts - to avoid finance charges and late fees; when resolved, this will result in a credit to the account on the next monthly statement.
Standard Process for Payment. The City’s standard accounts payable system is used in processing monthly credit card statements for payment. Cardholders will note the account number to be charged for each item appearing on the statement or note summary totals by account. The summary totals must tie to the total due on the credit card statement.
Supporting documentation for credit card payments should be the same as for any other accounts payable item. This means that original invoices (or receipts) along with credit card receipts must be retained and reconciled and attached to the credit card statement.
Lost or Stolen Cards. Cardholders are responsible for ensuring that the issuing bank and the Finance Department are notified immediately if the card is lost or stolen. Failure to do so may result in making the cardholder responsible for any fraudulent use of the card.
Disciplinary Action. Department managers are responsible for all disciplinary action surrounding misuse of cards, including requesting cancellation of card privileges.
Cancellation by Finance Department. Any employee card may be cancelled at the discretion of the Finance Department at any time.
Return of the Card Upon Request or Termination. Cardholders will immediately surrender their card upon request of their department manager or the Finance Department. Human Resources is responsible for retrieving the credit card when an employee separates from the City. Use of the credit card for any purpose after its surrender is prohibited.
RESPONSIBILITIES
Cardholders.
1. Determine that budget is available for the intended purchase.
2. Determine that the purchase complies with City policies and is in the City’s best Item 8.4
Mountain House Page 768 of 984 43 interest.
3. Obtain an approved requisition for purchases of $5,000 or more.
4. Make purchases during the month using the credit card and retain original and detailed receipts for each purchase showing the individual items purchased.
5. After receiving the credit card statement, assign each purchase to an appropriate general ledger account number in the City’s accounting system depending on the type of expense.
6. Submit the credit card detail with the original receipts to the Finance Department for review by the deadline set by the Finance Department In the event that submissions are late more than once within a fiscal year, the Finance department reserves the right to terminate the card at its sole discretion.
Department Managers.
A s N e e d e d
Authorize issuance of credit cards and set credit limits; develop and implement departmental procedures to ensure that payments are appropriately reviewed and approved, processed in a timely manner and that all supporting documentation is retained, reconciled to monthly statements and attached to payment vouchers; and oversee implementation of these guidelines.
Because of the potential for late charges and the need to allow time for the Finance Department to process payment, credit card bills must be processed immediately upon receipt of the approved credit card statements by the Department Managers.
Routine Monthly Process
1. Ensure any cardholders under their jurisdiction return the credit card statement with associated receipts by the specified time each month.
2. Review the credit card statement and receipts to determine:
a. That the charges represent legitimate City expenses incurred in accordance with City policy
b. That the account coding for the transactions is correct c. That receipts are attached for all charges.
3. Sign the statement indicating the review has been completed and forward the statement to the Finance Department within 48 hours of receiving the downloaded statement from the Finance Department.
Finance Department.
As Ne e d e d
Obtain credit cards as requested by department managers in accordance with these guidelines; and replace lost or stolen cards.
Routine Monthly Process
1. Download the credit card statements and distribute them to the cardholders for approval and account classification.
2. Review credit card statements approved by Department Managers to determine:
a. That the statement has been authorized for payment by the Cardholder and Department Manager
b. That the account coding for the transactions appear correct c. That the purchases appear to have been made in accordance with City policies
3. Process the credit card bill for payment according to the normal bill payment process.
Because of the potential for late charges and the need to allow time for the Finance Item 8.4
Mountain House Page 769 of 984 44 Department to process payment, credit card bills must be processed immediately upon receipt of the approved credit card statements by the Department Managers.
Human Resources. Retrieve credit cards from employees separating from the City.
SUMMARY
These guidelines cannot cover every issue, exception or contingency that may arise in using City credit cards. Accordingly, the basic standard that should always prevail is to use common sense and good judgment in the use and stewardship of City resources.
Item 8.4
Mountain House Page 770 of 984 45 City Credit Cards: Credit Cardholder Use Agreement Exhibit A
CITY OF MOUNTAIN HOUSE
CREDIT CARDHOLDER USE AGREEMENT
Employee: Department:
The above named employee (Cardholder) of the City of Mountain House (City) has been issued a City credit card. The Cardholder has been provided with a copy of the City's credit card policy, and hereby agrees to comply with all terms and conditions set forth therein, including but not limited to:
1. Official Use Only. City credit cards are for official City use only. Charging personal expenses on City cards is a misuse of City funds and a serious breach of the City’s ethics policy. Doing so - even if the intent is to reimburse the City later - may result in disciplinary action, up to and including termination. Minor incidental expenses as a component part of a larger billing - such as personal telephone calls or video rentals on a hotel bill - may be allowed if reimbursed at the time the credit card billing is submitted for payment.
2. Timely, Accurate and Supported Payments. Credit card payments will be processed on a timely basis, and adequate supporting documentation (such as vendor order forms, receipts, invoices and credit card receipts) will be retained for all charges and attached to the credit card statement. The cardholder must submit the credit card detail with the original receipts to Finance for review by the deadline set by the Finance Department. In the event that submissions are late more than once within a fiscal year, the Finance Department reserves the right to terminate the card at its sole discretion. The cardholder agrees to assume personal liability for late fees incurred if the cardholder does not return an accounting for credit card charges by the time set forth in this policy. The cardholder also authorizes a payroll deduction from his or paycheck to cover the cost of personal charges not immediately reimbursed to the City as required under this policy.
3. Disputed Charges. The cardholder will immediately notify the vendor and issuing bank of any disputed charges.
4. Lost or Stolen Cards. The cardholder agrees to notify the issuing bank and the Finance Department immediately of a lost or stolen card. Failure to do so could make the Cardholder responsible for any fraudulent use of the card.
5. Surrender Upon Request or Separation. The cardholder will immediately surrender the credit card upon retirement, termination, or upon request of the department manager or Finance Department. Use of the credit card for any purpose after its surrender is prohibited.
6. Credit Card Limit. The credit limit of this card is $ .
7. Other Restrictions. _____________________________________.
Cardholder Signature Date
DISTRIBUTION: Original—Cardholder Personnel File Copies—Finance Department and Cardholder
RETURN OF CITY CREDIT CARD UPON SEPARATION FROM CITY EMPLOYMENT Cardholder Signature Date Human Resources Date
I HEREBY SURRENDER the credit card issued to me by the City of Mountain House to the Human Resource Department. I declare that all outstanding charges on the credit card are for official City business and will be paid through established procedures.
Item 8.4
Mountain House Page 771 of 984 46 Section 260
Objectives
The objectives of the City’s accounts payable and cash disbursements policy are as follows:
• City vendors are paid on time in accordance with the City’s obligations. • City vendors are paid correct amounts.
• Only authorized amounts are paid.
• City expenditures are recorded consistently in the proper GL accounts. • City correctly tracks open purchase order or contract balances and applies vendor payments against the correct purchase order or contract. • City maintains timely information about any outstanding liabilities to vendors.
Scope of This Policy
This policy addresses requirements for all cash disbursements from the City for purposes other than employee payroll, which is covered under a separate policy.
Vendor Invoice Submission Requirements
The Finance Department may delay or decline to process vendor invoices unless they meet the following criteria:
1. Vendor invoices must clearly identify the item(s) for which the City is being billed.
2. Vendor invoices must identify the time period when the physical good(s) came into the City’s ownership or the service(s) were delivered. If the invoice includes charges from multiple fiscal years, the Finance Department may require the vendor to break the charges down between fiscal years.
3. Vendor invoices must include a City Purchase Order number or contract number unless the requested payment is for:
a. An invoice of $5,000 or less
b. Credit card payments (but the cardholder should supply the purchase order number for any individual purchases on their card in excess of $5,000 unless an exception applies)
c. Employee reimbursements where no single non-travel item exceeds $5,000 d. Utility services payments as specifically defined in the purchasing policy e. Membership dues
f. Services delivered by San Joaquin County
g. Government and regulatory fees as defined in the purchasing policy h. Rents and lease payments if the lease has been appropriately approved in accordance with City procedures.
i. Long-term debt payments appropriately authorized under City procedures.
4. Vendor invoices must be mathematically accurate.
5. Vendor invoices must be submitted directly by the vendor via e-mail to the City’s invoice processing e-mail address or addressed to the attention of Accounts Payable at the City’s office and first opened in the Finance Department. The Finance Department will decline
ACCOUNTS PAYABLE AND CASH DISBURSEMENTS
Item 8.4
Mountain House Page 772 of 984 47 to process any invoice for payment unless it has been submitted by the vendor directly to the Finance Department as required under this policy or an exception is approved by the Administrative ServicesFinance Director.
6. Vendor invoices for services performed or goods delivered during a fiscal year must be submitted to the City within 45 days of the end that fiscal year.
Cash Disbursements Without Vendor Invoices
Although the general rule is that vendor payments require an invoice in accordance with the requirements outlined above, in limited circumstances, the Finance Department may proceed with processing a vendor payment without an invoice from the vendor or with an invoice that does not meet all of the requirements above as determined by the Administrative Services Director or Finance Director. This will typically occur for well-known and routine City obligations, such as the payment of refuse disposal charges that the City collects from customers to the disposal service provider or monthly lease payments where the City has entered into a lease but does not receive invoices from the lessor. Whenever this occurs, alternate supporting documentation must be prepared by the City explaining the need for the payment and the calculation of the payment amount.
Disbursement Procedure for Payment by Physical Check
Upon the submission of an invoice meeting the above “Invoice Submission Requirements,” or if an appropriate exception is approved, the payment procedure is initiated, as follows:
1. The Finance Department will log the invoice on a pending invoice log and then forward the invoice to the responsible Department Head or designee for review within 2 business days of receipt.
2. The Department Head or designee will review the invoice and respond to the Finance Department within 7 business days of the date it is forwarded to them that the invoice is approved, approved with modifications, denied, or on hold. If the responsible department places a hold on a vendor invoice, they shall notify the Finance Department within the 7 day period following their receipt of the invoice the reasons for the hold and when they expect the hold will be resolved.
3. If the Department Head approves the invoice for payment, the Department Head or designee will sign the invoice and indicate the proper GL account coding for processing and return the invoice to the Finance Department.
4. The Finance Department will review the approved invoice for the following, returning to the Department for correction as necessary:
a. Is the person who signed or approved the invoice for payment authorized to approve invoices on this purchase order or for this GL account? b. Is the GL account coding or purchase order number assigned by the department accurate in view of the items shown on the invoice?
c. Will the invoice exceed the available balance in the purchase order or budget available for the GL account, where applicable?
d. Are any delivery or service addresses listed on the invoice for City locations, or is there a legitimate reason why a good or service would be delivered at a location other than the City’s facilities?
e. Does the invoice raise substantial concerns that the goods or services were not used Item 8.4
Mountain House Page 773 of 984 48 for City business?
5. If the vendor has not been previously set up (ordinarily this will only happen for invoices of $5,000 or less since vendor setup should be complete at the time of a purchase order if one is issued), the Finance Department will contact the vendor and obtain the required W9 and new vendor for information.
6. If the account coding is accurate and the vendor has been set up, the Finance Department will enter the invoice into the accounting system. Care must be exercised to ensure the invoice is entered accurately, especially in the following areas:
a. The payable date entered coincides with the date the services or goods were delivered.
b. The GL account and PO number, if applicable, correctly matches the information on the invoice.
c. The vendor invoice number is entered exactly as written on the invoice or using a standard practice developed to ensure the data entry in this field is consistent. This will help ensure that the system will reject duplicate invoices submitted for payment with the same invoice number.
7. If the invoice causes a budget overage or exceeds the amount available on the purchase order, the Finance Department will contact the Department Head and will stop further processing until a budget adjustment is processed, the purchase order value is increased, or the invoice is reassigned to another appropriate GL account or purchase order where sufficient budget exists.
8. The entered invoices that have passed the system’s internal budget check will then be reviewed by a different Finance Department employee than the one who performed the initial input for accuracy. The reviewer will consider:
a. Whether the invoice raises any substantial questions or concerns. b. Whether the payable date has been correctly entered based on the date the goods or services were delivered on the invoice
c. Whether the invoice account coding is accurate (taking into account which GL account has been used consistently to charge the item in the past, if applicable) d. Whether the invoice has been charged against the correct purchase order based on the purchase order number shown.
9. After the internal review, the Finance Department will process for payment. The current authorized signers are the City Manager, Administrative Services Director, Finance Director, Accounting Manager, but the authorized signers may be changed from time to time by action of the City Manager.
Wire Transfers
It is City policy that all wire transfers of City funds require the signature of two authorized individuals. The procedure for documenting and approving wire transfers from the County Treasury is as follows:
1. For vendor payments to be made by wire transfer, the vendor invoice or alternate documentation shall be reviewed and entered into the City’s accounting system in accordance with procedures 1-8 described above under “Disbursement Procedure for Payment by Physical Check.”
2. For wire transfers from City bank accounts to another bank or investment account owned by the City, if permitted, documentation supporting the dollar amount or need Item 8.4
Mountain House Page 774 of 984 49 for the transfer is not required for City purposes. However, the creation of written wire transfer instructions and signature of two authorized individuals shall still be required to execute the transfer.
3. After successful review and approval of the obligation for payment, the Accounting Manager or another Finance Department staff member shall prepare written wire instructions identifying the dollar amount and bank routing information to execute the wire. Unless the wire transfer destination is another account owned by the City, the Finance Department staff member will attach the supporting invoice or alternate documentation substantiating the City’s need to make the payment (e.g. contract, legal document) and the calculation of the amount, if applicable.
4. The written wire transfer instructions must be carefully reviewed (as to the accuracy of the dollar amount and destination routing information as well as the legitimacy of the payment, where any of these apply) by two of the following:
a. City Manager
b. Administrative Services Director
c.b.Finance Director
d.c.Assistant Finance Director
e.d.Accounting Manager
5. The two reviewers as described above must both sign the wire transfer instructions. The signature may be physical or electronic.
6. After being signed by two authorized individuals, the Accounting Manager or designee may proceed with requesting the wire.
Year End Payables Processing
In order to accurately close the fiscal year on a timely basis, the general requirement is that vendors submit invoices for all work performed or goods delivered within a fiscal year by no later than 45 days following the fiscal year end. Exceptions may be approved by the Finance Director or Administrative Services Director.
During the period following the end of a fiscal year, the Finance Department staff will ensure that any invoices for work performed or services delivered in the prior fiscal year are appropriately posted to that year until the established cutoff time. After that time, if the Finance Department identifies any additional invoices for work performed or goods delivered in the prior fiscal year, the invoice should be brought to the attention of the Finance Director or Administrative Services Director. The Finance Director and Administrative Services director will then determine whether to pay the invoice. If they approve payment, they will log the invoice and determine the materiality of any collective late invoices for posting to the prior fiscal year during the audit process.
Item 8.4
Mountain House Page 775 of 984 50 Section 310
OVERVIEW
Travel on City business or individual contract business shall be by the most economical means consistent with the situation, as determined by the City Manager. The City will reimburse authorized travelers for their necessary and reasonable expenses incurred while traveling on City business.
Pre-Travel Authorization
The Department Manager must approve travel on City business outside of San Joaquin County in advance. All City employees shall submit a travel request to Finance at least 14 business days prior to travel, listing the expected expenses of the trip.
Post Travel Expense Reconciliation
Within 15 calendar days of return to the workplace, the Post Travel Expense Reconciliation Form must be completed for non-local travel, approved by the Department Manager and/or City Manager, and submitted to the Finance wherein actual travel expenses must be reconciled.
Select the Least Expensive Method of Travel Consistent with City Needs Employees may make their own transportation/ and lodging reservations or have the City staff make them. Travel shall be by the least expensive method consistent with the work needs of the City as determined by the City Manager or designee. An employee wishing to travel by private car rather than public transportation shall be reimbursed only up to the cost of public transportation and necessary car rental as determined by the City Manager.
Specific Types of Travel Expenses
Local Travel. The City will fully reimburse authorized travelers for cab, local bus, and rapid transit expenses. Receipts must support any amount over $3.50.
Parking. The City will fully reimburse authorized travelers for parking expenses. Receipts are required for amounts over $6.00.
Transportation. Use of air, train, private car or bus shall be selected on the basis of the most reasonable and appropriate method, taking into consideration distance, time and total costs to the City. If an employee elects to use a mode of transportation other than stated above, the City will pay only the cost of the most logical and least expensive mode. The difference between the selected mode and the most logical and the least expensive mode shall be considered the employee’s personal expense. In addition, the employee shall charge any additional time spent en route during normal work hours to vacation or similar time bank.
Private Automobile Reimbursement. For employees who do not receive a car allowance and need to travel on City business, the employee will be reimbursed for the use of their private vehicle at the IRS standard business mileage rate in effect on the date when the travel occurred if the
TRAVEL POLICY
Item 8.4
Mountain House Page 776 of 984 51 following requirements are met:
1. No City-owned vehicle was reasonably available for the trip or the use of a City vehicle was waived by the Finance Department.
2. The employee carpooled with one or more other City employees traveling to the same location at the same time for City business, if applicable. This requirement shall not apply in cases, as determined by the City Manager or Finance Department, where there is a reason related to City business that one or more employees travel separately (e.g. scheduling demands).
3. The mileage is certified by the claimant and approved by the manager.. There is no mileage reimbursement for travel between an employee’s residence and the workplace. Mileage reimbursements are calculated from the employee’s place of work to destination.
Employees who receive a car allowance are not entitled to mileage reimbursement for the use of their private vehicles unless they can demonstrate that the mileage reimbursement for a trip exceeding 500 miles roundtrip would be lower than the cost of economy class commercial airfare and car rental for the same trip. Employees who receive a car allowance also should not request City vehicles for trips of less than 500 miles roundtrip.
Rental Car. The City Manager or designee may authorize use of a rental car. Employees should rent compact cars when traveling unless business necessity dictates otherwise, as determined by the City Manager or designee. Authorized travelers may claim cost of gas, oil, and related auto expenses when supported by receipts and when such expenses are not part of the rental agreement.
Travelers should accept the corporate rate whenever possible. This rate includes necessary insurance. When the corporate rate is taken, travelers do not need to accept the over-the-counter insurance unless they do not have required coverage on their personal insurance. If a traveler must take over-the-counter insurance because personal insurance does not meet City minimums, the extra insurance cost will not be reimbursed. For economic reasons, travelers are strongly encouraged to fill the gas tank of the rental car themselves before turning it back in to the rental agency.
Tolls. The City will fully reimburse authorized travelers for tolls. Receipts are required for amounts over $6.00.
Lodging. The City will fully reimburse authorized travelers for actual lodging expenses consistent with the area of travel when supported by the itemized bill from the establishment. Lodging and the cost of lodging must be pre-approved by the City Manager or designee. Hotel and motel charges shall be based on single occupancy rates. The city will not reimburse employees for lodging expenses incurred for additional guests. In instances where destination hotels are filled, the employee should attempt to secure comparable rates at the nearest hotel. Receipts for lodging costs must be presented. Non-compensable lodging expenses not considered a City expense include, but are not limited to: late check-out and guarantee charges, personal services (i.e. barber/hair salon, shoeshines, health club and/or massage, entertainment.
Meals. The City will reimburse for meals in compliance with IRS per diem regulations. Receipts are not required, however but employees must document the dates, location and purpose of the travel on the reimbursement form. . The cost of meals reimbursed will not exceed the Federal Per Diem rate applicable to the location where the meal was eaten.
Only the City Manager is allowed to host meals for other persons when the meal is related to business of the City. The claim for reimbursement must be supported by receipts, a listing of the Item 8.4
Mountain House Page 777 of 984 52 names and titles of guests, dates, and the business purpose of the meal.
Registration Fees. The City will fully reimburse authorized travelers for registration fees required to attend a seminar, organized luncheon meeting, etc., when supported by receipt. Reimbursement will occur only when the employee has prior written authorization and is representing the City.
Incidental Expenses. The City will reimburse authorized travelers for actual incidental expenses incurred, such as personal phone calls, taxi driver and baggage tips, etc. up to a maximum of $8.00 per day (no receipt required) when certified by the claimant. These are claimed and itemized as incidentals on the claim form. The City will also reimburse authorized travelers for other necessary expenses such as printing and purchases of supplies. Receipts are required.
Personal Extension of Business Trip. When employees traveling by air wish to extend an authorized trip beyond the time required for business, they may do so on their own time as long as they obtain pre- approval for vacation taken. The City will reimburse the employee for the cost of lodging and meals only up to the initial return date.
Family Members or Guests. Travel arrangements and payment of costs for family members or guests are not eligible for payment by the City. Travel arrangements and payment of costs for family members or guests are to be handled directly by the employee.
Unauthorized Expenses: The following items of a personal nature, even if they are incurred in conjunction with expenditures that are subject to reimbursement, are not reimbursable: movies, entertainment, premium television services, alcoholic beverages, dry-cleaning, spas, gyms, barber, magazines, shoe shines, purchase of clothing or toiletries, loss of tickets, fines or traffic violations, excess baggage costs, golf related expenses, personal losses incurred while on City business, spouse and/or guest expenses, repairs to personal vehicles, office equipment and other items of a personal nature. Optional tours, banquets or other activities not related towards professional development offered through the conference, but as an additional cost to registration, are solely at the discretion of the employee and will be considered as a personal expense. The department head and/or City Manager shall determine what constitutes professional development. If unauthorized expenses have been paid by the City, the employee will be responsible for reimbursement to the City within five business days.
Travel Advance. The only payment that will be made to employees in “advance” will be for the IRS per diem, bridge toll and mileage, when documentation in writing is attached to the form.
Payments in advance must be submitted to Finance no later than 14 business days prior to departure.
Adequate Records
It is the responsibility of the traveler to keep adequate documentation of expenses claimed for reimbursement. Such documentation must substantiate the date, amount, and business purpose of the expenses. Incidentals, while not requiring receipts, must be itemized on a log with the date, description of each incidental expense, and amount attached to the travel claim. All receipts must be original. They should be placed in chronological order and attached to 8 1/2 X 11 sheets of paper with the date and explanation next to the receipt. Any claim submitted that does not follow these guidelines may be returned to the claimant for correction. The City follows IRS requirements for accountable plan reimbursement of employees. Any exceptions to this policy require written approval by the City Manager or designee.
Item 8.4
Mountain House Page 778 of 984 53 Section 320
The City reimburses employees for using their personal car in conducting City business at the IRS approved business standard mileage rate, or, for certain employees, a car allowance. Consistent with the IRS basis in setting the standard mileage rate, the City’s per mile reimbursement rate reflects all costs associated with operating a vehicle, such as depreciation, lease payments, maintenance, repairs, fuel, oil, insurance (including deductibles) and vehicle registration fees.
The rate is updated at least annually in an official notice published by the IRS. Employees receiving a car allowance are not eligible for reimbursement based on actual mileage driven.
CURRENT MILEAGE REIMBURSEMENT RATE
Item 8.4
Mountain House Page 779 of 984 54 Section 330
Objectives
The objectives of the City’s payroll policy and procedures are as follows:
• City employees are compensated at the correct rate for services performed. • City employees are paid for the correct number of hours worked. • City payroll is released to employees on time.
• Only authorized amounts are paid.
Compensation
New positions. All new positions are approved by the City Council. When approving the new position, the City Council establishes the a salary range for that position. The initial compensation is established by the Human Resources Manager, with input from the department manager and authorization from the City Manager.
Existing represented positions. Employees represented under collective bargaining agreements typically receive annual cost of living adjustments and step increases in accordance with those agreements and at management discretion where applicable.
Existing unrepresented positions. Unrepresented employees other than the City Manager receive step increases and/or cost of living adjustments at the discretion of the City Manager.
Procedure for adjusting compensation rates.
1. All collective bargaining agreements and any other management decisions with respect to employee compensation are provided immediately to the Human Resources Manager.
2. The Human Resources Manager prepares an EPAD form for each employee whenever that employee’s compensation should change. Employee compensation must match established salary tables. The Human Resources Manager then submits the completed EPAD form to the Payroll team in the Finance Department.
3. The Payroll team processes the EPAD and updates the payroll system, returning the completed EPAD to the Human Resources Manager who files the form in the respective employee’s personnel file.
4. The Human Resources Manager will access the payroll register for the pay period following the effective date of the salary change to ensure that the change was implemented correctly. A copy of the initial pay register will be placed in the employee personnel file.
New Hires
When the City hires a new employee, the employee is asked to report to the Human Resources Manager on their first day to complete new hire paperwork and go through an orientation in all cases except for seasonal employees hired for recreation.
PAYROLL SYSTEM AND PROCESSING
Item 8.4
Mountain House Page 780 of 984 55 Seasonal employees hired for recreation attend an orientation at City offices and complete their new hire paperwork at that time. The Human Resources Manager then forwards the paperwork to the Payroll team for processing.
Included in the new hire paperwork is a direct deposit form where the employee designates the bank account into which their direct deposit should be made. Only the Payroll team can add a new employee to the system or change the direct deposit information on an employee and they do so only after receiving proper forms from the employee or the Human Resources Manager.
Payroll Processing (Bi-Weekly)
City’s payroll payments are released to employees on a bi-weekly basis on Fridays for the twoweek period ending on the Sunday preceding the Friday pay day. Following is a detailed calendar of events for each payroll period.
Date Procedure Responsible
Employees
Last
ThursdayWednesd
ay of 2-Week Pay
Period
All employees prepare their timecards according to the
City’s template, sign them, and submit the timecards
to their supervisor. They include hours they expect to
work on the last Thursday and Friday of the pay
period even though the timecard must be submitted
before then.
All Employees
5:00 PM,
Last Thursday of
2-Week Pay
Period
Supervisors review each of their employee timecards,
considering the following questions:
1. Does the timecard agree with my knowledge of
the hours the employee worked for this pay
period, especially if there are overtime hours?
2. Has the employee correctly included time off
on the timecard when time off was taken?
3. Is the number of hours reported consistent with
the times in and out written on the timecard
and does the timecard correctly reflect the
employee lunch period?
After reviewing the employee timecards, the
supervisor signs the timecards and submits them to the
Finance Department by 5:00 PM on the last Thursday
of the pay period.
All Supervisors
Last Friday of the
Pay Period
The Finance Department reviews the timecards
submitted by the supervisor for mathematical
accuracy, inconsistencies in the time data report, and
lack of signatures, and returns incomplete or
inconsistent timecards to the supervisor for
correction.
Finance
Department,
Supervisors
Item 8.4
Mountain House Page 781 of 984 56 4:00 PM,
Monday Following
the End of the Pay
Period
After receiving corrected timecards, the Finance
Department must complete initial input of the payroll
data by 4:00 PM on the Monday following the end of
the pay period into into the ADP system.
Finance
Department
Tuesday Morning
Following the End
of the Pay
Period
The Finance Department checks the ADP system for
exceptions on the payroll entered the day before as
soon as the workday begins and works with
supervisors to resolve all exceptions by noon.
Finance
Department,
Supervisors,
as needed
Friday Following
the End of the Pay
Period
ADP Payroll system initiates direct deposits to pay
employees based on the bank account information
submitted on direct deposit forms to the payroll team
and mails any paper checks directly to the employees.
Finance
Department
At Least
Monthly
After payroll has been disbursed to the employees, the
Accountant accesses the ADP system and runs a query
to obtain the posted payroll expense figures and then
inputs this information into a journal entry template
created for this purpose and imports the transaction to the City’s accounting system.
Accountanting
Technician
Employee Separations
The Human Resources Manager maintains an employee separation checklist of tasks to complete when an employee separates from City employment, which includes the following:
1. On the day an employee separates from City employment, the Human Resources Manager submits a form to the Payroll team notifying them of the separation. The final paycheck is processed according to the normal payroll calendar and after that the Payroll team removes the employee from active status in the payroll system so they can no longer be paid.
2. The Human Resources Manager notifies San Joaquin County IT to disable the former employee’s login credentials to the City’s network.
3. The Human Resources Manager disables the former employee’s access badge used to access City facilities and collects all keys the former employee possessed.
4. The Human Resources Manager collects the City’s credit card from the employee, if the employee had been issued a credit card. See the Credit Card Policy for further details.
The Accounting Manager will verify that any separated employees no longer appear on the pay register for the first payroll after their final paycheck has been processed.
Item 8.4
Mountain House Page 782 of 984 Section 400
57 The purpose of this section is to describe the City’s policies and procedures regarding the management of the City's fixed assets and inventory items.
Areas currently covered include:
• Accounting for fixed assets
• Contributions/dedications of capital assets from others • Inventory of fixed assets
• Surplus property
FIXED ASSETS AND INVENTORY MANAGEMENT
Item 8.4
Mountain House Page 783 of 984 58 Section 410
OVERVIEW
The City defines capital assets, for the purposes of capitalization, as a purchased or otherwise acquired piece of equipment, vehicle, furniture, fixture, capital improvement, or land or an addition to buildings or infrastructure. In accordance with GASB standards, capital assets also include intangible assets lacking physical substance that are used in City operations such as computer software, permits, and other items that are nonfinancial in nature (bonds, securities, investment instruments, and investment contracts are not considered capital assets or intangible assets). Under GASB requirements, intangible assets must either confer on the City specific legal rights (e.g. a permit or water rights) or be capable of being divided from the City and sold to another party. The cost or value of any such acquisitions must be $5,000 or more per discrete item with an expected useful life greater than one year. Purchases of multiple items are aggregated into a single item for capitalization purposes when the items purchased are attached or assembled together into a single item and are not expected to be disassembled during the expected useful life of the item, except for maintenance purposes.
Infrastructure acquired from City developers is recorded when an offer of dedication is accepted and capitalized using amounts in the offer of dedication, which is an estimate.
These asset dedications are grouped assets and are based on the description in the offer of dedication.
Additions or improvements that significantly extend the useful life or substantially increase the operating efficiency or capacity of an asset are capitalized. Other related costs that only enable an asset to meet its original estimated useful life or operational efficiency are considered maintenance expenditures in the period incurred.
The Finance Division will record all items requiring capitalization. All fixed assets are valued at cost, or estimated cost, if actual cost is not available. Contributed fixed assets are recorded at estimated fair market value at the time received. The Fixed Asset System will be updated at least annually in conjunction with the annual audit.
ACQUISITION
During the budget process, planned capital asset acquisitions are budgeted in designated “capital outlay” expenditure accounts (object codes beginning with the number 7). The assets are actually acquired during the year according to the procedures specified in the City’s purchasing policies, with the ultimate expenditure booked to one of the capital outlay expenditure accounts.
After the end of the fiscal year, the Finance Director or designee reviews capital outlay expenditure accounts and other accounts which may contain capital assets and makes appropriate adjustments to capitalize the assets by moving them into balance sheet accounts (in the case of the utility enterprise funds) or prepares worksheet adjustments for the financial statement reporting process to reflect the assets as capitalized on the government-wide financial statements (in the case of governmental funds).
CAPITAL ASSET ACCOUNTING
Item 8.4
Mountain House Page 784 of 984 59 DEPRECIATION
Depreciation, a measure of the exhaustion of economic resources, is an allocation of the cost of a fixed asset over its useful life. Though it is important to include an allowance for replacement of fixed assets in our budgeting process, we need to use caution when using depreciation expense as recognized on our financial statements to determine a reserve for replacement cost. This is because depreciation expense is based on the historical cost of the assets when they were originally placed into service. It is not adjusted for inflation, market conditions, changes in the City’s capacity needs, or changes in technology since the time an asset was placed into service that could significantly impact the replacement cost of an asset.
It is also based on an estimated useful life of an asset that is difficult to determine with precision at the time an asset is purchased.
The City maintains a depreciation schedule in Excel or an accounting module to track its capital assets and calculate depreciation expense. After the end of each fiscal year in preparation for the annual audit of the financial statements, the Finance Director or designee determines all capital assets that were added or disposed of during the year, updates the depreciation schedule, double-checks the calculation of depreciation using check formulas, reconciliations, and/or other methods, and finalizes the calculation. In adding assets to the depreciation schedule, care should be exercised to include as much detail on the cost of asset components as is reasonably practicable so that portions of a significant project that are expected to be replaced at different times can be removed from the depreciation schedule separately when appropriate. Estimated useful lives are assigned to the various classes of fixed assets as follows:
Fixed Asset Class
Estimated Useful Life
(in Years)
Vehicles, equipment and machinery 2 – 10
Structures and improvements 10 – 50
Infrastructure
Road system network
Pavement 40
Curbs and gutters 50
Sidewalks 50
Medians 50
Traffic signals 30
Street lights 40
Fixed Asset Class
Estimated Useful Life
(in Years)
Bridges 75
Trails - asphalt 40
Trails- concrete 50
Utility Infrastructure
In-ground Pipes 60
Manholes 60
Catch basins 5
Detention basins 5
Item 8.4
Mountain House Page 785 of 984 60 Section 420
CONTRIBUTIONS/DEDICATIONS OF CAPITAL ASSETS FROM OTHERS
OVERVIEW
Under the City’s Master Plan and Master Acquisition and Reimbursement Agreement (MARA), and conditions of approval attached to final maps, developers in the City are obligated to construct certain capital assets (primarily infrastructure and community facilities) upon the occurrence of certain events and then transfer those assets to City control and ownership subject to the City’s procedures for accepting such assets. The City’s policies and procedures are designed to reduce the City’s risk of incurring costs due to defective assets and to ensure proper accounting for these assets in accordance with generally accepted accounting principles.
AGREEMENT ON ASSETS TO BE CONSTRUCTED/FINAL MAP
Prior to beginning any development, a developer must have a final map approved by the City Council showing the development plan. In order to obtain the final map, the developer works with an appropriate engineer on the City’s engineering staff to agree to conditions of approval that call for installation of specific public facilities and infrastructure and enters into subdivision improvement agreement(s) and/or off-site improvement agreement(s) that give specific details on the public facilities to be constructed by the developer as a condition of approval. The conditions of approval commit the City to accepting the public facilities and/or infrastructure subject to specified conditions. The conditions of approval, subdivision improvement agreement(s), and/or off-site improvement agreement(s) are approved by the City Council concurrently with approval of the final map.
PLANS
After approval of the final map, the developer submits detailed improvement plans to the City’s Engineering Department on the facilities/infrastructure to be constructed. These plans are sufficiently detailed that a construction contractor could use them to construct the assets.
The
Engineering Department or its consultants review the plans for compliance with the City’s standards and specifications. If they meet with City approval, a City engineer then signs the plans and returns them to the developer.
CONSTRUCTION
The developer engages appropriate contractors to begin construction according to the improvement plans signed by the City’s engineer. Throughout the construction process, the City’s engineers or consultants inspect the construction to ensure it is being done according to plan.
Item 8.4
Mountain House Page 786 of 984 61 COMPLETION AND DEDICATION
When construction is completed, a City Engineer or consultant engaged by the City performs a final inspection using a checklist for this purpose. Once the inspector is satisfied that the completed asset meets City requirements, s/he writes a letter to the City stating that the developer has met the City’s requirements and recommending acceptance. The Engineering Department then prepares an Offer of Dedication and Dedication Agreement specifically describing the assets to be dedicated and providing the estimated total cost of the assets, as well as a Certificate of Acceptance and presents these documents to the Finance Department and the
City Manager. The City’s City Manager signs the documents and routes them to the Finance Department, which will deliver them to the developer. The developer will then record the change in ownership at San Joaquin County. From this point on, the City assumes responsibility for operation and maintenance of the asset. The signed offers and certificates of dedication are then scanned by the administrative staff and placed in the Offers of Dedication folder under City Shared Directories.
ACCOUNTING
At the time of dedication, the assets become the property of the City and therefore must be added to the capital asset balances reported on the City’s financial statements. If the asset contributed is included under the City’s Transportation Impact Fee (TIF), Community Facilities Fee (CFF), or utility infrastructure programs, the asset will be recorded on the financial statements at the certified cost of the asset, with an offsetting entry to the long-term debt associated with the applicable type of program. If the certified cost of such an asset is not yet available, the asset will be recorded based on an engineering estimate and then adjusted to the certified cost when that becomes available. If the asset is not covered under one of these programs, the capital asset will be recorded to an income statement account as a contribution. If the asset is in one of the utility funds (water, sewer, and stormwater), the entry will be made in the Tyler Incode 10 system by the Administrative Services Director or Finance Director. If the asset is not related to an enterprise fund, the receipt of the dedication will be recognized for financial reporting purposes under the Finance Department’s procedure for recording government-wide financial statements
Item 8.4
Mountain House Page 787 of 984 Section 430
62 OVERVIEW
Performing periodic inventory checks of the City’s fixed assets and other designated noncapitalized items that are nonetheless valuable is a part of the City’ stewardship of public resources and fiscal accountability. The inventory accomplishes two objectives:
1. Improving the accuracy of the City’s financial reporting by ensuring that assets that are damaged or no longer in use are removed promptly from the City’s depreciation schedule and general ledger system, where applicable.
2. Ensuring that property purchased with City funds remains in the possession and control of the City, is properly cared for, and is used for City purposes.
Items to be Inventoried
The inventory lists that are verified on an annual basis should include all items listed on the City’s capital asset and depreciation schedule.
Inventory Procedure
1. Following the adoption of the City’s budget each year, the Finance Department will circulate a set of lists to all Department Managers that collectively comprise all items to be inventoried as described in the above section.
2. Each Department Manager will verify that all of the items listed on his or her list:
a. Are functioning as intended. If there is any damage, the damage will be noted. b. Are located either on the City property or are in the custody of City employee outside of City property for an appropriate business purpose. c. Continue to be used for City business purposes.
3. Completed lists will be returned to the Finance Department by July 31 of each year.
4. The Finance Department may select items on the list to independently verify.
INVENTORY OF CAPITAL ASSETS
Item 8.4
Mountain House Page 788 of 984 63 Section 440
OVERVIEW
It is financially advantageous and fiscally prudent for the City to dispose of surplus personal property in a manner that maximizes revenue and converts idle equipment and materials to revenue, thereby recovering funds for other uses.
Surplus personal property includes plant and office equipment, vehicles, machinery, furniture, fixtures, consumable supplies, scrap, junk and other goods and materials no longer usable or needed by the City.
LEGISLATIVE POLICY
The City Manager, in his/her capacity as Purchasing Agent, is responsible for the sale or disposal of City-owned personal property not required for public use.
ADMINISTRATIVE POLICY
This policy shall apply to all sales and dispositions of surplus City-owned personal property.
1. Department heads are responsible for identifying property to be surplused and reporting all surplus property to the Purchasing Agent. The Purchasing Agent is responsible for determining the fair market value of such property.
2. The Purchasing Agent or designee is authorized to sell, transfer, trade, or otherwise dispose of surplus personal property or consumable supplies having a fair market value of ten thousand dollars ($10,000.00) or less in the manner they deem most appropriate and cost- effective, consistent with State of California statutes and City policies described herein.
3. Disposal of surplused property with an estimated fair market value exceeding ten thousand dollars ($10,000.00) per item requires approval of the City Council. With Council approval, the Purchasing Agent is authorized to sell, transfer, trade, or otherwise dispose of surplus personal property having a fair market value in excess of $10,000.00 in the manner they deem most appropriate and cost-effective, consistent with State of California statutes, City policies described herein, and Council direction.
4. Methods of transfer and disposal include transfer to another department, trade-in, return to manufacturer, sale, or donation.
5. Appropriate methods of sale include public auction, public sales, or sealed bids. Public auctions and sales may be conducted by City staff or the City may contract with a professional auctioneer, dealer, or on-line auction site. Sealed bids must be solicited for the sale and the property shall be sold to the highest responsible bidder.
SURPLUS PROPERTY
Item 8.4
Mountain House Page 789 of 984 64 6. No City official, officer or employee shall purchase, or be financially interested in any purchase, of surplus property.
7. Surplus property may be donated to any other public agency or charitable organization. “Public agency” means the State or any agency or subdivision thereof, any city, county, special district, or school district. “Charitable organization” means an organization that has been granted tax exempt status under Section 501(c)(3) of the Internal Revenue Code.
8. Should any surplus item fail to be sold at public auction or sale or by sealed bid, the City may donate the item to a public agency or charitable organization in lieu of sending materials to landfill.
9. All surplus property is disposed of “as is” with no warranty, guarantee, or representation of any kind, expressed or implied, as to the condition, utility or usability of the property offered unless expressly authorized by the City Council.
10. Disposal of surplused computer equipment will comply with the following conditions:
a) All licensed software will be removed from computers b) All electronic files will be deleted
c) Computers may be reloaded with operating system software only if legal d) The City will not guarantee the current or future working condition of the equipment e) The City will not provide technical assistance with the set-up, repair or operation of the equipment
11. Non-working electronic or universal wastes may not be sold or transferred. Devices containing mercury such as gauges, thermostats, sphygmomanometers, and thermometers may not be sold and must be managed in accordance with California statutes.
Item 8.4
Mountain House Page 790 of 984 65 Section 500
OVERVIEW
The purpose of this section is to describe the City’s budget policies and procedures. Areas currently covered include:
• Overview of the City’s budget process
• Budget amendment requests
• Reappropriation policy for operating programs and capital improvement plan projects
• Monitoring budget performance—monthly expenditure reports and comprehensive annual financial report
• Accounting for completed capital improvement plan (CIP) projects
BUDGET AND FUND ACCOUNTING POLICIES AND PROCEDURES
PPPROCEDURES
Item 8.4
Mountain House Page 791 of 984 66 Section 510
Balanced Budget
The City’s budgets must always be technically balanced, in that estimated resources available to finance the budget must equal or exceed budgeted expenditures or uses of funds. In addition, the City also strives to always adopt a structurally balanced budget, in which current operating expenses are financed solely by current year revenues, or, in unusually poor economic conditions, by reserves set aside for stabilization. Debt and existing fund balance should generally only be used to provide resources to finance capital acquisitions that will benefit the City over a period of time.
Funds Budgeted and Not Budgeted
The City’s budget includes all funds of the City except for developer funds. These funds are not budgeted because expenditures are reimbursed by developers pursuant to agreements and it is difficult to predict the amount of developer activity that will occur in a given fiscal year.
Budgetary Policies
The budget will be prepared and implemented in compliance with the following guidelines:
User Fees and Charges will be Set at the Cost of the Service Fees and associated charges are associated with recovering the cost of providing a service. The City can charge up to the full cost of providing a service. • Fees will be set to fully recover costs, except where there is a greater public benefit through use of a lower fee, such as where full recovery may adversely impact overall revenue or may discourage participation in programs where the participation benefits the overall community.
• The City Manager will establish a process in-depth review of all fees over time. The review, while eventually covering all fees, should emphasize those that have or may have significant subvention (may not be at full cost).
One-Time Resources will be Used Only for One-Time Purposes One-time resources are revenues that only occur once, for a very limited time, or are too unpredictable or unstable to fund operations. One-time revenues may include the variable portion of some revenue sources that have highly variable components. One-time revenues are not suited to fund ongoing operations because they are not available in the future or cannot be relied on from year-to-year to pay the ongoing costs of operations. • One-time resources will not be used to fund ongoing operations. They will be used for one-time uses, including capital and other one-time expenditures, transitional funding of operations (for a limited time-period with a planned ending date), increasing reserves, or paying down unfunded liabilities.
BUDGET POLICIES AND ASSUMPTIONS
Item 8.4
Mountain House Page 792 of 984 67 Capital Projects will be Budgeted and Funded for Both Capital and Operating Costs Expenditures for capital and infrastructure often have an impact on operating costs. Capital investments and infrastructure eventually have to be replaced. New capital projects typically increase costs while repairs may lower costs. For capital expenditure decisions, both the onetime capital costs, the ongoing net operating costs, and replacement costs (lifecycle) should be considered. When capital and infrastructure funding decisions are made, it is important to provide information to the City Council about future operating costs and potential replacement costs and funding of replacement.
• Before approving any capital expenditure, including those proposed by any elected official, the City Council shall consider both the capital (one-time) and operating (ongoing) components of costs, including the full capital cost of the project, regardless of funding sources, and all City-incurred site, design, overhead costs and start-up costs.
Replacement costs and potential method of funding shall also be considered. Site costs for land already owned by the City do not need to be reported. • Projected operating costs through any stabilization period, as well as projected future operating and maintenance costs, are to be identified. If the project has a limited economic life, the fiscal impact information should discuss proposed end of life actions and costs.
The method for funding the projected operating costs is to be included in any funding description. Projects and costs that do not significantly impact the City do not need to be analyzed.
• When fees are initially proposed for items charged to external parties but installed and maintained by the City, the City Council shall have information to allow the Council to consider incorporation of capital costs, maintenance costs and replacement cycle costs in the fees or upfront costs. Costs that are not significant do not need to be analyzed.
Budgetary Basis of Accounting
The budget is adopted on the modified accrual basis of accounting for all funds, including the utility enterprise funds, because the modified accrual basis more closely approximates cash flow and is thus more useful for budgeting purposes than the full accrual basis. Under the modified accrual basis, revenues are budgeted in the period when they are expected to be earned, but only to the extent that the earned revenue is expected to be received during the period or within 60 days after the end of the period. Expenditures are budgeted in the period in which the liability is expected to be incurred, except that for long-term liabilities, expenditures are recognized for interest and principal payments in the period they come due for payment. Expenditures are budgeted for capital asset acquisitions in the year acquired and depreciation is not budgeted.
The modified accrual basis of accounting is consistent with generally accepted accounting principles for financial reporting for governmental funds, but it differs from generally accepted accounting principles for the utility funds, which are reported on a full accrual basis.
Accordingly, when presenting budget-to-actual comparisons for enterprise funds on the budgetary basis, a reconciliation will be necessary to explain the differences between amounts recognized on a budgetary basis and amounts.
Item 8.4
Mountain House Page 793 of 984 68 Section 530520
Date Procedure Individuals
Involved
January 15 The Finance Department will develop the projected payroll and benefits budget based on anticipated
positions in the upcoming fiscal year, salaries, and
benefit costs. The Finance Department will also
develop revenue projections for the upcoming fiscal
year for any revenues that are not department-specific.
The Finance Department will submit this information
to the City Manager for review and discussion.
Finance
Department
January 31 The Finance Department sets up proposed budget input in the City’s OpenGov system for the upcoming
fiscal year and makes it available for
department managers to begin logging in and entering
the data.
Finance
Department
January 31 The City Manager reviews the projected payroll and benefits budget and projected City-wide revenues and
provides revisions to the Finance
Department.
City Manager
February 17 Department managers complete the budget form within OpenGov for the upcoming fiscal year,
including both a projection of current fiscal year
spending as well as the budget requested by each line
item for the fiscal year. Department managers will
include notes explaining any significant changes
anticipated from the prior year. Department Managers
will also include a discussion of goals for the
upcoming year and identify objective measures that
can be used to gauge the accomplishment of these
goals. Outside vendors or Consultants are prohibited from submitting or overseeing the budget. Budget is to be
submitted directly by the Department Manager.
Department
Managers
February 24 Department managers identify and submit a detailed Capital Improvement Plan budget to the Finance
Department.
Department
Managers
BUDGET PREPARATION TIMELINE AND PROCEDURES
Item 8.4
Mountain House Page 794 of 984 69 Date Procedure Individuals
Involved
February 15-
March 10
The Finance Department will review the budget
requests submitted by Department Managers for the
following:
1. Do the projected amounts of expenditures for
both the current fiscal year and the upcoming
fiscal year appear reasonable in comparison to
the prior year and when considering the
balances on open POs?
2. Has the Department Manager included detailed
notes explaining the content of budget line
items, calculation of estimated figures, and any
significant changes for the prior year?
3. Does the budget address conditions known to
the Finance Department that would be expected
to have an impact on budgeted amounts for the
upcoming year (e.g. known increases or
decreases in contract pricing for services
required, changes in circumstances that will
result in increased or decreased cost)?
4. Do the budgeted figures represent an efficient
use of City resources?
5. Are the performance measures identified by the
Department Managers appropriate measures of
the Department’s progress toward its goals?
The Finance Department will return budgets to
Department Managers for clarification by February 15.
Finance
Department
March 25 Department managers respond to all requests for clarification from the Finance Department.
Department
Managers
March 25-
April 10
The Finance Department will evaluate the information
presented by Department Managers and compile a
complete proposed budget document for the City. This
budget document will be submitted to the City
Manager for review.
Finance
Department
April 22 The City Manager reviews and provides and revisions to the proposed budget document developed
by the Finance Department.
City Manager
First
Wednesday in
May
The Finance Department will publish a complete
proposed budget document in the Council package for
the first Council meeting in May, incorporating
changes from the City Manager, if any.
Finance
Department
Item 8.4
Mountain House Page 795 of 984 70 Second
Wednesday in
May
The Finance Department and City Manager will
present the proposed budget to the City Council for a
first hearing at the first City Council meeting in May.
The City Council will evaluate the budget and give
direction to staff regarding any
changes desired to the proposed budget.
Finance
Department, City
Manager, City
Council
Late May If desired, the City Council may schedule additional hearings or study sessions on the proposed budget.
City Council,
Finance
Department, City
Manager,
Department
Managers
First
Wednesday in
June
The Finance Department will incorporate changes
requested by the City Council into a revised budget
document and publish the revised document in the
Council package for the first City Council
meeting in June.
Finance
Department
Second
Wednesday in
June
Assuming satisfactory changes were made, the City
Council will adopt the proposed budget at the first City Council meeting in June.
City Council
June 30 Using the Excel worksheet presented to the City Council, the Finance Department will import the final
adopted budget into the Tyler Incode 10 system. The
Finance Department will verify that the totals from the imported budget match those adopted by the City
Council through check totals and spot checks.
Finance
Department
90 days from
budget
adoption
Within 90 days from the date of budget adoption, the
Finance Department will complete a review of the
budget and submit it for consideration under the
Government Finance Officers’ Association’s
Distinguished Budget Presentation Award Program.
Finance
Department
Item 8.4
Mountain House Page 796 of 984 71 Section 540530
Exceeding Budget Prohibited
Expenditures in excess of the established budget for a line item are prohibited. The Finance Department will return unpaid any requests for payment or requisitions for purchase that exceed a budgeted line item. Originating departments must complete an Appropriation Adjustment Request (AAR) to adjust budged line items. The following details the level of authority granted for budget adjustments.
Department Managers
Department managers may adjust the budget under the following circumstances:
• The adjustment does not involve a payroll, personnel allocation, or overhead allocation account and;
• The adjustment reallocates expenditures other than those listed above so that the total amount of budgeted expenditures within the department and fund does not increase.
The Department Manager will complete and submit the AAR to the Finance Department to process a budget change meeting these criteria. Upon receipt of a properly executed AAR, the Finance Department will verify that the signer has the necessary authority as specified under this policy and then input the change into the Tyler Incode 10 accounting system.
City Manager
The City Manager may adjust the budget under the following circumstances:
• The adjustment reallocates expenditures so that the total amount of budgeted expenditures within each fund group reported as a single fund in the City’s audited financial statements does not exceed budged expenditures as approved by the Council. If the adjustment involves a new fund that has not yet been part of an audited financial report, the fund will be considered part of the fund grouping (if any) in which the Finance Department plans to report the fund in the next set of published financial statements for the City for purposes of this requirement. • The adjustment does not impact capital projects approved by the Council in the CIP budget or add a new capital project not previously approved by the Council. • The adjustment does not reduce budgeted expenditures related to special tax ordinances 96- 2, 96-3, and/or 96-4 (funds 202, 203, and 204) in order to increase budgeted expenditures related to special tax 96-1 (fund 201).
The City Manager will complete and submit the AAR to the Finance Department to process a budget change meeting these criteria. Upon receipt of a properly executed AAR, the Finance Department will verify that the signer has the necessary authority as specified under this policy and then input the change into the Tyler Incode 10 system.
Adjustments for personnel costs:
The City Council approves job descriptions for City personnel and authorizes the number of positions (full-time and part-time equivalent positions or FTEs). Any salary adjustments will be made in accordance with applicable Memoranda of Understanding with represented employees.
The City Manager may grant cost of living increases to unrepresented employees in accordance with Council direction. The City Manager may adjust salary grades of positions and an employee’s placement in the grade as deemed necessary and reasonable to address market conditions and employee performance and retention. All employees within a job classification
BUDGET ADJUSTMENTS AND AMENDMENTS
Item 8.4
Mountain House Page 797 of 984 72 will be paid using the same salary grade. The total amount of budgeted expenditures within each fund group may not exceed budgeted expenditures as approved by the Council as a result of salary adjustments made by the City Manager.
City Council
Any budget changes not falling within the authority of a Department Manager or the City Manager as defined above must be approved by the City Council in the form of a formal budget amendment. Changes that must be submitted to the City Council for approval include the following:
• Any change that increases total budgeted expenditures in a fund group report as a single fund in the City’s audited financial statements.
Personnel who need to initiate a budget amendment must submit an AAR to the Finance Department specifying the reasons of the budget change requested and the source of funds that will be used to cover any increased costs. The Finance Department will review the AAR to verify that sources of funds for the budget amendment are reliable and that the amendment is in accordance with City policy. If so, the Finance Department will forward the AAR to the City Manager for review. If the City Manager approves the AAR, the Finance Department will prepare a staff report and proposed resolution amending the budget to present to the City Council at the next regular City Council meeting. If the City Council adopts the budget amendment, the City Clerk will sign the AAR and attach a copy of the approved budget amendment resolution, returning it to the Finance Department. The Finance Department will then enter the approved budget amendment into the Tyler Incode 10 system.
Item 8.4
Mountain House Page 798 of 984 73 Section 550540
Objectives
The goals of the City’s fund structure are as follows:
• Compliance with fund type definitions under generally accepted accounting principles (GAAP) for state and local governments and facilitating the efficient preparation of financial statements prepared in accordance with GAAP.
• Demonstrating accountability for restricted resources entrusted to the City. • Minimizing error and complexity by avoiding the creation of funds that are not needed to efficiently serve the objectives noted above.
Types of Funds
The City’s fund types and the fund number mask for each type (XXX) are summarized below:
Governmental Funds (financed primarily by taxes, grants, and other nonexchange revenue) General Fund (1XX) - The General Fund is the general operating fund of the City. It is used to account for all financial resources and transactions except those required to be accounted for in another fund. It includes certain special accounts that are used to accumulate resources for designated purposes.
Special Revenue Funds (2XX) – Special revenue funds may be created where the foundation of the fund consists of revenues that are either restricted or committed for purposes other than capital projects or debt service.
Debt Service Funds (3XX) – Debt service funds consist of funds with resources dedicated to debt service either by external restriction or internal policy. The resources may be restricted, committed or assigned to debt service as specified in the GASB 54 fund balance policy.
Capital Projects Funds (6XX) – Capital projects funds consist of funds with resources dedicated to the acquisition or construction of capital assets either by external restriction or internal policy. The resources may be restricted, committed or assigned for capital projects as specified in the GASB 54 fund balance policy.
Enterprise Funds (financed primarily by charges for services to users, 5XX)
FUND STRUCTURE AND CREATION AND CLOSURE OF FUNDS
Item 8.4
Mountain House Page 799 of 984 74 Creation and Closure of Funds
The Administrative Services Director or Finance Director may create or close funds as deemed necessary to accomplish the objectives of this policy.
Item 8.4
Mountain House Page 800 of 984 75 Section 560550
Overview
Under Governmental Accounting Standards Board Statement No. 54 (GASB 54), the fund equity/fund balance in a governmental fund is classified into a maximum of 5 categories based on the extent to which restrictions (which may be natural, legal, or internal) limit the City’s ability to use the fund balance. As the City has adopted GASB 54, this policy is intended to summarize those requirements and clarify the City’s policy regarding fund balance where GASB 54 gives the City discretion to adopt such policies and how the policy applies in the City’s circumstances.
Scope of this Policy
As noted above, GASB 54 applies to governmental funds. It does not apply to enterprise funds (e.g. water, sewer, and stormwater), where the classifications of fund equity are somewhat different.
Definitions
Fund Equity – A fund’s equity is generally the difference between its assets and its liabilities.
Fund Balance – An accounting distinction is made between the portions of fund equity that is spendable and nonspendable. These are broken up into five categories:
1) Nonspendable fund balance – includes amounts that are not in a spendable form or are required to be maintained intact. Examples are inventory or endowments (permanent funds).
2) Restricted fund balance – includes amounts that can be spent only for the specific purposes stipulated by external resource providers or in the City’s enabling legislation.
Examples include may include grants, developer in-lieu fees, and taxes and assessments legally restricted to particular purposes.
3) Committed fund balance – includes amounts that can be used only for the specific purposes determined by a formal action of the government’s highest level of decisionmaking authority. Commitments may be changed or lifted only by the FUND BALANCE POLICY UNDER GASB 54
Item 8.4
Mountain House Page 801 of 984 76 government taking the same formal action that imposed the constraint originally. 4) Assigned fund balance – comprises amounts intended to be used by the government for specific purposes. Intent can be expressed by the governing body or by an official or body to which the governing body delegates the authority. In governmental funds other than the general fund, assigned fund balance represents the amount that is not restricted or committed. This indicates that resources in other governmental funds are, at a minimum, intended to be used for the purpose of that fund. 5) Unassigned fund balance – is the residual classification of the general fund and includes all amounts not contained in other classifications. Unassigned amounts are technically available for any purpose.
Policy
Restricted Fund Balance – The City receives the following types of revenues which it considers restricted. Residual amounts of these revenues, after being used for allowable purposes, are reflected as restricted fund balance in accordance with this policy:
1) Special Taxes Restricted to Uses Narrower than General City Use – The City receives multiple special tax revenues derived from parcel taxes on property within the City that are restricted to purposes narrower than the general needs of the City, such as those special taxes received and restricted for public safety, parks, recreation, and community facilities, and public works.
2) Developer Impact Fees – The City collects impact fees on building permits issued that are restricted to be used to pay for City facilities and infrastructure, such as the Transportation Impact Fee (TIF) and Community Facilities Fee (CFF).
Committed Fund Balance - The City Council is the City’s highest level of decision- making authority and the formal action that is required to be taken to establish, modify, or rescind a fund balance commitment is a formal motion or resolution approved by the City Council at the City Council’ meetings. The motion or resolution must either be approved or rescinded, as applicable, prior to the last day of the fiscal year for which the commitment is made. The amount subject to the constraint may be determined in the subsequent period.
Assigned Fund Balance - The City Council authorizes the City Manager, Administrative Services Director, and/or Finance Director to assign fund balance to a specific purpose as approved by this fund balance policy.
Item 8.4
Mountain House Page 802 of 984 77 Minimum Unassigned Fund Balance - It is the goal of the City to achieve and maintain an unassigned fund balance in the general fund equal to 3 months of general fund expenditures in a fiscal year.
If unassigned fund balance falls below the goal or has a deficiency, the City will adjust expenditures to assure that the minimum unassigned balance is maintained.
Order of Expenditure of Funds - When multiple categories of fund balance are available for expenditure (for example, a construction project is being funded partly restricted tax revenues, discretionary funds set aside by specific action of the City Council, and unassigned fund balance), the City will start with the most restricted category and spend those funds first before moving down to the next category with available funds.
Item 8.4
Mountain House Page 803 of 984 78 Section 570560
OVERVIEW
This Debt Management Policy (the “Debt Policy”) may be amended by the Council as it deems appropriate from time to time in the prudent management of the City’s debt.
This Debt Policy is intended to comply with Government Code Section 8855(i), effective on January 1, 2017, and shall govern all debt undertaken by the City.
The City hereby recognizes that a fiscally prudent debt policy is required in order to:
• Maintain the City’s sound financial position.
• Ensure the City has the flexibility to respond to changes in future service priorities, revenue levels, and operating expenses.
• Protect the City’s credit-worthiness.
• Ensure that all debt is structured in order to protect both current and future taxpayers, ratepayers and constituents of the City.
• Ensure that the City’s debt is consistent with its planning goals and objectives and capital improvement program or budget, as applicable.
POLICY
A. Purposes For Which Debt May Be Issued
(i) Long-Term Debt. Long-term debt may be issued to finance the construction, acquisition, and rehabilitation of capital improvements and facilities, equipment and land to be owned and operated by the City.
(a) Long-term debt financings are appropriate when the following conditions exist:
• When the project to be financed is necessary to provide basic services. • When the project to be financed will provide benefit to constituents over multiple years.
• When total debt does not constitute an unreasonable burden to the City and its taxpayers and ratepayers.
• When the debt is used to refinance outstanding debt in order to produce debt service savings or to realize the benefits of a debt restructuring. (b) Long-term debt financings will not generally be considered appropriate for current operating expenses and routine maintenance expenses.
DEBT MANAGEMENT POLICY
Item 8.4
Mountain House Page 804 of 984 79 (c) The City may use long-term debt financings subject to the following conditions:
• The project to be financed must be approved by the City Council. • The weighted average maturity of the debt (or the portion of the debt allocated to the project) will not exceed the average useful life of the project to be financed by more than 20%.
• The City estimates that sufficient revenues will be available to service the debt through its maturity.
• The City determines that the issuance of the debt will comply with the applicable state and federal law.
(ii) Short-term debt. Short-term debt may be issued to provide financing for the City’s operational cash flows in order to maintain a steady and even cash flow balance. Short-term debt may also be used to finance short-lived capital projects; for example, the City may undertake leasepurchase financing for equipment.
B. Types of Debt
The following types of debt are allowable under this Debt Policy:
• General obligation bonds
• Bond or grant anticipation notes
• Lease revenue bonds, certificates of participation and lease-purchase transactions • Other revenue bonds and certificates of participation • Tax and revenue anticipation notes
• Land-secured financings, such as special tax revenue bonds issued under the Mello- Roos Community Facilities Act of 1982, as amended, and limited obligation bonds issued under applicable assessment statutes
• Tax increment financing to the extent permitted under state law • Conduit financings, such as financings for affordable rental housing and qualified 501c3 organizations
The City may from time to time find that other forms of debt would be beneficial to further its public purposes and may approve such debt without an amendment of this Debt Policy.
Debt shall be issued as fixed rate debt unless the City makes a specific determination as to why a variable rate issue would be beneficial to the Issuer in a specific circumstance.
C. Relationship of Debt to Capital Improvement Program and Budget The City is committed to long-term capital planning. The City intends to issue debt for the purposes stated in this Debt Policy and to implement policy decisions incorporated in the City’s capital budget and the capital improvement plan.
The City shall strive to fund the upkeep and maintenance of its infrastructure and facilities due to normal wear and tear through the expenditure of available operating revenues.
The City shall seek to avoid the use of debt to fund infrastructure and facilities improvements that are the result of normal wear and tear.
Item 8.4
Mountain House Page 805 of 984 80 The City shall integrate its debt issuances with the goals of its capital improvement program by timing the issuance of debt to ensure that projects are available when needed in furtherance of the City’s public purposes.
The City shall seek to avoid the use of debt to fund infrastructure and facilities improvements in circumstances when the sole purpose of such debt financing is to reduce annual budgetary expenditures.
The City shall seek to issue debt in a timely manner to avoid having to make unplanned expenditures for capital improvements or equipment from its general fund.
D. Policy Goals Related to Planning Goals and Objectives The City is committed to long-term financial planning, maintaining appropriate reserves levels, and employing prudent practices in governance, management and budget administration. The City intends to issue debt for the purposes stated in this Policy and to implement policy decisions incorporated in the City’s annual operations budget.
It is a policy goal of the City to protect taxpayers, ratepayers and constituents by utilizing conservative financing methods and techniques so as to obtain the highest practical credit ratings (if applicable) and the lowest practical borrowing costs.
The City will comply with applicable state and federal law as it pertains to the maximum term of debt and the procedures for levying and imposing any related taxes, assessments, rates and charges.
When refinancing debt, it shall be the policy goal of the City to realize, whenever possible, and subject to any overriding non-financial policy considerations (i) Minimum net present value debt service savings equal to or greater than 3.0% of the refunded principal amount, and
(ii) Present value debt service savings equal to or greater than 100% of any escrow fund negative arbitrage.
E. Internal Control Procedures
When issuing debt, in addition to complying with the terms of this Debt Policy, the City shall comply with any other applicable policies regarding initial bond disclosure, continuing disclosure, post-issuance compliance, and investment of bond proceeds.
The City will periodically review the requirements of and will remain in compliance with the following:
• Any continuing disclosure undertakings under SEC Rule 15c2-12, • Any federal tax compliance requirements, including without limitation arbitrage and rebate compliance, related to any prior bond issues, and • The City’s investment policies as they relate to the investment of bond proceeds.
Item 8.4
Mountain House Page 806 of 984 81 Whenever reasonably possible, proceeds of debt will be held by a third-party trustee and the City will submit written requisitions for such proceeds. The Issuer will submit a requisition only after obtaining the signature of the City Manager or his/her designee.
Item 8.4
Mountain House Page 807 of 984 82 Section 580570
OVERVIEW
This policy documents requirements and responsibilities to be followed regarding borrowing between funds of the City of Mountain House.
The purpose of this policy is to ensure that all interfund loans are appropriate, properly documented, and not established to the detriment of the fund issuing the loan.
POLICY
Interfund loan recommendations and agreements must include the loan amount, an identified repayment source and the date or timing of repayment.
The agreements may include an interest component that equals the investment earnings the fund would have received had the loan not occurred, with the following exceptions:
• Amounts loaned from the Water, Wastewater and Stormwater funds to other City funds must include an interest component.
• Amounts loaned to Developer funds must include an interest component.
When it is determined that interest will be paid by the borrowing fund to the lending fund, the amount of interest to be charged will be calculated using the rate investment rate earned by the Local Agency Investment Fund (LAIF).
The City Council must approve by resolution all interfund loans.
Payments made on outstanding loans shall be reflected in the proposed and adopted operating budget and in the annual financial statements. The annual financial statements will also include the loan amount, term, rate of interest, and amount of interest due on the total amount of the loan.
Interfund loan agreements will be reviewed and approved by the Council annually.
DEFINITION
Interfund loans are loans from one City fund to another City fund for a designated purpose.
Interfund loans may be made for the following reasons:
• To offset timing differences in cash flow
• To provide financing for interim financing in conjunction with obtaining long-term financing
INTERFUND LOAN POLICY
Item 8.4
Mountain House Page 808 of 984 83 • For short-term borrowing in place of external financing • To provide operating capital for utility funds while the customer base increases • For other needs as deemed appropriate by the City Council Interfund loan monies may only be used for the purpose identified in the authorizing resolution.
Records of interfund loan transactions will be maintained in accordance with generally accepted accounting principles and will reflect the balances of loans in every fund affected by such transactions.
Item 8.4
Mountain House Page 809 of 984 84 Section 610
OVERVIEW
The purpose of these guidelines is to set forth standards, responsibilities and procedures for the prudent management of cash and investments.
CASH
The City’s cash is held by fiscal agents in accordance with bond indentures , in special deposits as approved by the City Council, in the San Joaquin County Treasury, and in the City’s operating bank accounts . The City maintains cash not needed for current operations in the San Joaquin County pooled cash fund for the purpose of increasing interest earnings.
The City also has bank accounts which contain pooled cash funds used for operating expenses.
CASH WITH FISCAL AGENTS
All of the City’s restricted investments are held by fiscal agents in various accounts for the purpose of paying principal and interest on and establishing reserves for outstanding bonds and for paying down the pledged notes payable. Cash with fiscal agents is invested in accordance with applicable bond ordinances and agreements with developers.
BANK ACCOUNTS
The City Manager or his/her designee is authorized to open and close bank and investment accounts as deemed appropriate and necessary to accomplish the business objectives and activities of the City. Authorized signers will include the Administrative Services Director, Finance Director and Accounting Manager. The accounts will be utilized, recorded and reconciled in accordance with the policies contained in Sections 630 and 640 of this Manual.
CASH AND INVESTMENTS
Item 8.4
Mountain House Page 810 of 984 85 Section 620
OVERVIEW
This Investment Policy may be amended by the Council as it deems appropriate from time to time in the prudent investment of the City’s special deposits.
Policy Statement - The City is guided by three objectives in its investment of public funds.
In order of priority those objectives are:
1.1. Safeguarding of principal.
1.2. Ensuring that investments satisfy the liquidity needs of the City.
1.3. Obtaining an optimal rate return on available assets, commensurate with an appropriate level of risk.
2. Scope - This investment policy applies to all special deposit funds not required for the immediate operating needs of the City and are accounted for in the City’s monthly financial report.
3. Objectives: The priority ranked objectives of the City’s investment activities shall be:
3.1. Legality. Investments shall only be made in securities legally permissible by the California Government Code, Sections 53635, 53635.2 et seq.
3.2. Safety. Investments shall be undertaken in a manner that seeks to ensure preservation of capital in the overall portfolio. To attain this objective, diversification is required. Investments must be made in securities of high quality to avoid credit risk and loss of principal.
3.3. Liquidity. The investment portfolio must remain sufficiently liquid to enable the City to meet all foreseeable operating requirements.
3.4. Return on Investment. The investment portfolio shall be designed with the objective of attaining a market rate of return, taking into consideration policy objectives and cash flow characteristics of the portfolio.
4. Delegation of Authority - The City Council is responsible for the management and oversight of the investment program. Day to day management responsibility for the investment program is delegated to the City’s City Manager, who will ensure that the investment program is in accord with the Council’s directives. The City Manager shall be responsible for all transactions undertaken and will establish a system of controls to regulate the activities of appropriate staff members.
5. Prudence - Investments shall be made with time relevant judgment and care, which persons of prudence, discretion and intelligence exercise in the management of their own affairs, and not for speculation, but for investment, considering the probable safety of principal as well as the probable income to be derived. The standard of prudence to be used by investment officials shall be the “prudent person” standard and shall be applied in the context of managing an overall portfolio with aims to safeguard the principal and maintain the liquidity needs of the agency. The prudent investor
INVESTMENT POLICY
Item 8.4
Mountain House Page 811 of 984 86 standard states that when investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including but not limited to, the general economic conditions and the anticipated needs of the City, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims to safeguard the principal and maintain the liquidity needs of the City.
6. Borrowing for Purposes of Making Investments - Management is prohibited from the practice of borrowing for the sole purpose of making investments.
7. Authorized Investments and Limits - The City Manager or his/her designee may only invest funds in the following secure and reliable permitted investments:
7.1. Investment in the California Local Agency Investment Fund (LAIF), San Joaquin County pooled cash account, California Asset Management Program (CAMP), or other professional investment services permitted for all local agencies under California Government Code Section 53601(p). Funds shall be placed with these investment services as alternative liquid investments under this policy.
7.2. Shares of Beneficial Interest issued by diversified management companies, otherwise known as Mutual Funds, investing in the securities and obligations as authorized by the California Government Code, sections 53601 et seq.
7.3. United States Treasury Bills, Notes, Certificates of Indebtedness, or those for which the full faith and credit of the United States are pledged for the payment of principal and interest.
7.4. Savings Accounts or Certificates of Deposit issued by a nationally or state chartered bank, or, savings association fully insured by the FDIC or FSLIC.
7.5. U.S. Federal Agency or United States government-sponsored enterprise obligations, participations or other instruments issued by the Government National Mortgage Association (GNMA), the Federal Home Loan Bank (FHLB), the Federal National Mortgage Association (FNMA), the Federal Home Loan Mortgage Association (FHLMC), the Federal Farm Credit System (FFCB), and the Federal Agricultural Mortgage Company/Farmer Mac (FAMCA).
7.6. Medium Term Corporate Notes, defined as all corporate and depository institution debt securities with a maximum remaining maturity of five years or less, issued by corporations organized and operating within the United States or by depository institutions licensed by the United States or any state operating within the United States. Notes eligible for investments under this subdivision shall be rated “A” or better by a nationally recognized rating service.
8. Maximum Maturities - To the extent possible, investments shall be made to match anticipated cash flow requirements. Furthermore, no investment with a term in excess of five years may be made.
Item 8.4
Mountain House Page 812 of 984 87 9. Internal Control - As part of the City’s annual independent audit, the investment program shall be reviewed for appropriate internal controls that provide assurance of compliance with policies and procedures.
10. Reporting - The City Manager shall provide the City Council with a quarterly report of investment activity verifying that the investment portfolio is in compliance with the City’s investment policy. The report will also include a statement indicating the City’s ability to meet its expenditure requirements for the ensuing six months or to provide an explanation as to why sufficient funds shall not or will not be available.
11. Ethics and Conflicts of Interest – Officers and employees involved in the investment process shall refrain from personal business activities that could conflict with proper execution of the investment program, or which could impair their ability to make impartial decisions.
12. Investment Policy Review - The City Council shall review the investment policy annually. The Council shall accept and approve the investment policy and any changes.
Item 8.4
Mountain House Page 813 of 984 88 Section 630
Objectives
The objectives of this bank and treasury reconciliation policy are as follows:
• Ensure the City’s accounting records are kept with reasonably current balances for all cash and investment accounts owned by the City with reconciliations completed monthly by the end of each month for the preceding month. • Promptly identify and resolve errors made either by the bank, County Treasury, or investment custodian or errors made on the City’s books. • Promptly identify and resolve unauthorized activity occurring in the City’s accounts.
Segregation of Duties
Best practices in internal control assign the responsibility for reconciling a bank account to an individual who neither has the authority to authorize disbursement from the account nor makes entries in the accounting system impacting the account. The ability to fully segregate this function depends on staffing level and cost-benefit considerations. The Finance Department will consider these best practices as well as the City’s business needs when assigning an individual to the bank reconciliation function.
County Treasury and other Investment Accounts
The combined balance of cash and investments in the San Joaquin County and with other investment services will be reconciled on a monthly basis to the City’s general ledger balances in the 1111 object accounts using the pooled cash report defined for this purpose. The following describes the detailed procedure to be followed.
1. By the 15th day of each month, the Finance Department personnel responsible for reconciling the County Treasury pooled cash account will obtain the County Treasury balance from the San Joaquin County EFS system and pull a pooled cash report from the Tyler Incode 10 system for the end of the previous month.
2. The reconciler will compare the activity posted between the City’s general ledger system and the County, listing the exact amount of each item causing a difference. The reconciler will compare vendor names in the County system to the names posted in the City’s general ledger system. The reconciler may write off trivial amounts that are not worth the time it would take to research. The reconciler may employ any or all of the following procedures to identify the difference:
a. Verifying that all County-initiated journal entries (“SSTs”) and property tax revenues posted by the County have been posted to the City’s GL as well. b. Verifying that all utility refund batches sent to the County for payment have been recorded in the GL for the month.
c. Determining whether any accounts payable check batches or deposits sent to the County for processing and posted to the City GL near the end of the previous month were not posted by the County to the EFS until after the end of the month. d. Comparing detailed transaction lists from the City GL and the County EFS and
BANK, INVESTMENT, AND COUNTY TREASURY RECONCILIATION
Item 8.4
Mountain House Page 814 of 984 89 marking off items that are accounted for in both lists to identify the items that are different.
e. Re-running the pooled cash report for the last month that had previously been reconciled and comparing it to the report that was originally used when that reconciliation was done to determine if a back-posting to a previous month in the GL may have occurred.
3. After identifying any differences, the reconciler will complete the reconciliation by submitting the following documents for review to a reviewer who is not typically involved in executing or routinely reviewing the day-to-day cash receipting or disbursing processes, such as the Administrative Services Director or Finance Director:
a. County EFS printout showing the balance in the County Treasury at the end of the previous month
b. Tyler Pooled Cash Report as of the previous month end c. Listing of any differences between the two
d. Supporting documentation for any significant differences that will carry forward into the following month
4. After reviewing the bank reconciliation and supporting documents and determining that any differences appear appropriate, the reviewer will initial or otherwise indicate review of the bank reconciliation packet, which will then be filed.
Utility Payment Lockbox
On a monthly basis by the 15th day of each month, the Finance Department will reconcile the utility payment lockbox account for the previous month according to the following procedure:
1. First, the deposits and withdrawals from the Utility Payment Lockbox account will be reconciled to the i3 Verticals, LLC reports as follows. a. Using a template designed for this purposes, the Finance Department will recompute the ending balance in the lockbox account using the total payments received reported in the utility billing system. This will ensure that if the total payments received in the lockbox do not match the payments received in the billing system, the difference will be identified.
b. The reconciliation will account for the differences identified, including the following common differences:
i. Timing differences such as payments included in the utility billing system in a different month from the month they are deposited into lockbox bank account.
ii. The receipt of customer deposits and overpaid amounts in the current month in the lockbox account that will not be applied to a customer account until a future month.
iii. The application of customer deposits and prior month overpayments to customer accounts which result in a reduction to the customer account balance in the current month for payments that may have been posted to the lockbox account in previous months.
iv. Merchant processing fees, bank service charges, and other fees deducted Item 8.4
Mountain House Page 815 of 984 90 from the bank account but not accounted for in the utility billing system. v. Refunds on closed accounts that may be treated as a negative payment in the billing system even though the refund payment is not actually made from the lockbox account and therefore does not impact the lockbox bank balance.
2. After reconciling the activity in the lockbox bank account to the utility billing system, the Finance Department will post the monthly journal entry to record the utility billing activity in the subsidiary system. The entry will be designed to eliminate timing differences in the ending account balance by distributing those differences out to revenue accounts and then reversing them in the following month.
3. After the posting of the utility billing journal entry for the month, the Finance Department staff will verify that the total balance in the 1116 Cash in Lockbox account in the General Ledger matches the ending balance in the lockbox bank account.
Other Bank Accounts
For any other bank or investment accounts, the Finance Department will compare the statement balances to the General Ledger on a monthly basis and make the appropriate adjustments by the end of the following month. The reconciling items for other bank accounts will be typically minimal.
Item 8.4
Mountain House Page 816 of 984 91 Section 640
OVERVIEW
The City currently utilizes desktop deposit technology to scan and deposit incoming checks at the City for incoming customer utility payments, which are deposited to a designated account, and would like to implement similar desktop deposit technology for non- utility payments as well to facilitate faster clearing of incoming funds. The City also has recurring bills with a short window of time to make payment and is left with an extremely short turnaround time to submit these bills for processing to ensure the payments are disbursed timely and penalties avoided.
Government Code Section 53952(b) permits the City to establish a revolving fund in an amount not to exceed one hundred and ten percent (110%) of one twelfth (1/12) of the City’s adopted budget for the current fiscal year.
Deposit of Incoming Payments to Imprest/Revolving Account For all incoming check payments that are not utility payments, amounts and payment details will be logged on the City’s incoming revenue log. The incoming checks and any supporting documentation will be placed in a secured container in the Accounting Manager’s office. Key access will be limited to the Accounting Manager and Finance Director. The City will then deposit all incoming checks to its imprest/revolving account, preferably using desktop deposit technology where the checks are scanned and deposited right in the City’s Office. The imprest account is currently at Wells Fargo Bank; City staff will not have ability to add accounts to the desktop technology. The bank will control access to the system with user names and passwords.
A Finance Department staff member will compare the incoming revenue log total with the total deposited by desktop deposit. After resolving any differences, the Finance Department staff member will post a deposit to the Incode General Ledger system 1112 imprest/revolving account.
All incoming checks subject to this policy should be deposited to the imprest/revolving account within two (2) business days of receipt. Checks that have been deposited successfully through desktop deposit should be bundled by deposit date and maintained in a secure location. If the City receives a check that cannot be scanned using the desktop technology,
IMPREST CASH CHECKING ACCOUNT POLICY
Item 8.4
Mountain House Page 817 of 984 92 the maker will be requested to provide a replacement and the original payment will be stored in the secure container until a replacement is successfully deposited. The original payment will then be voided and returned to the maker.
Allowable Uses of Funds from Imprest/Revolving Account
Other than flowing into the County Treasury, the funds in the imprest/revolving account will be used sparingly in the discretion of the Finance Department and in any event may only be used to pay for lawful expenses or obligations of the City that meet both of the following two criteria:
• The expense or obligation is currently or routinely required to be paid within a short time period that creates uncertainty as to whether it will be processed timely if payment is made through the County Treasury OR is five hundred dollars ($500) or less, AND;
• The payment is to a payee who is exempt from IRS form 1099 reporting (e.g. a governmental entity or corporation) or is of a nature that is exempt from 1099 reporting by reason other than dollar amount (e.g. accountable plan reimbursement to an employee, which would never be subject to 1099 reporting regardless of dollar amount). Payments that would be subject to 1099 reporting but for the fact that they fall below six hundred dollars ($600) are not permitted, because of the potential for multiple payments to occur within one year.
Examples of allowable uses are (this list is not all-inclusive):
• Electric utility bills paid to a government agency exempt from 1099 reporting where there is a short time before payment is due
• Payment of State Disability Insurance taxes where there is a short time before payment is due
Signature Authority
Checks drawn on the imprest/revolving account may be signed by any of the following:
• Administrative Services Director
• Finance Director
• Accounting Manager
Signers of checks drawn on the imprest/revolving account will review backup documentation and ensure the proposed disbursement is consistent with this policy prior to signing any checks.
Disbursement Procedure
• The imprest/revolving account will be set up as a Cash in Other Banks account (GL object 1112) in the Tyler Incode General Ledger system. All disbursements from the imprest/revolving account will be prepared using the Incode General Ledger system. • Check stock for the imprest account will be stored in a locked safe.
Item 8.4
Mountain House Page 818 of 984 93 • One of the authorized signers noted above may designate a list of obligations that will routinely be paid from the imprest/revolving account. Any transaction not so designated must be approved for use of this procedure prior to preparation of the check.
• Where feasible, a Finance Department staff member other than an authorized signer should prepare all checks for disbursement from the imprest/revolving account after reviewing appropriate backup documentation.
• Backup documentation supporting the transaction should be attached to the vendor invoice within Incode.
• Checks and supporting documentation will be presented to an authorized signer for a physical (wet) signature. No signature stamps, check signing machines, or signature images will be permitted.
• After the check is signed, the Finance Department staff member preparing the check will distribute it to the appropriate party.
Bank Reconciliation
The imprest/revolving account will be reconciled to the Incode general ledger account on a monthly basis by the end of the month following the month being reconciled. A Finance Department staff member who is not involved in the disbursement process should reconcile the account using the following procedure:
1. Obtain the bank statement directly from the bank online or unopened in the incoming mail.
2. Compare the transactions on the bank statement to transactions recorded in the 1112 General Ledger account for the imprest/revolving account.
3. Inspect copies of checks clearing the account to determine the check vendor on the check appears consistent with the vendor shown in Incode for that check.
4. Prepare and sign a reconciliation report identifying all differences (such as individual outstanding checks) between the bank statement balance and the General Ledger balance.
5. If the balance in the account has exceeded $300,000 for two consecutive weeks, recommend that a check be written to deposit excess funds in the County Treasury.
6. Submit the reconciliation report on a rotating basis for review to each of the authorized signers on the imprest/revolving account.
Item 8.4
Mountain House Page 819 of 984 94 Section 710
New Service
The Customer Service department will process all requests to establish service. Homeowner may email or fax completed service order along proof of ownership toto the Customer Service department. Inframark. Inframark Customer Service department will set up in AVR billing system. Inframark sends a log each night to the City and Inframark Field Reps of all new accounts.
Final Account (Close Account)
Customer Service department will process all requests to stop service. Homeowner may email or fax required documents to Customer Service department.
Monthly Billing and Payments
The Customer Service departmentInframark processes all monthly billing using the AVR program. Payment options are as follows:
• Mail to: City of Mountain House – PO Box 684000, Houston, TX 77268 • In person (check, cashier’s check, money order): City of Mountain House – 251 E.
Main Street, Mountain House CA 95391
• Drop Box (check, cashier’s check, money order) at City of Mountain House office – Box is emptied at 4:30 pm (PST)
• Online at www.mountainhouseca.gov
• Pay by phone (800) 441-4501
• Scan to Pay on the bottom of your bill
Payments mailed to the Houston address and all electronic payments are processed by i3 Verticals, LLC and deposited to the City of Mountain House Lockbox Wells Fargo Bank account.
A Customer Service Representative (CS Rep) will process payments made at City of Mountain House into the i3 Verticals, LLC system. The Customer Service Representative then gives the checks to the Accountant who scans the checks and performs a desktop deposit to deposit the funds to the Wells Fargo Lockbox account.
Delinquent Notices
The City will calculate and process delinquent notices for all accounts that have not paid by the due date. Inframark will then mail notices to each customer.
UTILITY BILLING AND PAYMENTS
Item 8.4
Mountain House Page 820 of 984 95 48-hour door tags
The City will calculate the 48-hour door tag file. They will then send the file to the City. The City will print the tags. An Inframark field representative will hang the tags on the property.
Disconnect for non-payment
The Customer Service department Inframark will calculate the disconnect list/file. They will then send it to the City for approval. A City Customer Service Rep will review each account.
CS Rep will review recent notes and payments along with any possible order to close account due to sale. Upon approval, The Customer Service departmentInframark will then add fees to account ($100.00 Cut-Off Charge + $300 Deposit). The City will print the tags. An Inframark field representative will hang the tags on the property and disconnect the service.
Customer must call the City Customer Service Department with confirmation number after making payment. The Customer Service Department will confirm payment and generate an order to have service restored.
Liens
A City Customer Service Rep will run a Collection Accounts Detail Listing for all accounts with a delinquent balance of $500.00 (amount subject to change) at the beginning of each month. Rep will review each account status, recent notes, payments, amortization plans and check to see if the account holder is an owner or tenant.
After attempting to contact the customers with a delinquent balance and/or sending a courtesy letter, CS Rep will prepare the appropriate paperwork to record a property lien against the customer’s property, which will assist the City in collecting the past due funds if the property sells to a new owner. CS Rep will present the lien paperwork to the Administrative Services Director, Finance Director, or Accounting Manager for signature. After receiving the appropriate signature, CS Rep will file the paperwork with the County Recorder to record the lien.
On an annual basis, CS Rep will mail Lien Notification letters to the owner of each property by certified mail. CS Supervisor will add $100.00 lien fee to the account. CS Rep will log account information on the Lien Tracking spreadsheet and on the account. The owner will have 10 days from the date of the letter to appeal. CS Supervisor will notify Tracy Press (via email) to run lien publication 10 days prior to City Council Meeting. CS Supervisor will submit a listing of unpaid accounts to the Administrative Services Director to be included on the Staff Report. City Council will review and approve for lien or give further collection instructions. City Manager and City Secretary will sign & notarize documents. CS Rep will send documents to San Joaquin County for recording. CS Supervisor will review all unpaid liens and roll them over to the County tax roll in August. CS Rep will have the lien amount written off in AVR by Inframark.
Collection on Closed Accounts
Item 8.4
Mountain House Page 821 of 984 96 CS Supervisor will run a Collection Accounts Detail Listing each month and review accounts that are delinquent for 30+ days. Supervisor will review owner information, payment information, account notes and new account holder. If the account holder was a tenant, the unpaid balance will be transferred to the owner’s account. If the property has been sold and is currently in a new owner’s name then the unpaid balance will be sent to collections. CS Supervisor will log account information on a spreadsheet and email to the City in order to have the money transferred or sent to Collections Unlimited.
Reconciliation
At the end of each month, the Accountant downloads the bank statement for the Wells Fargo Lockbox account. S/he also receives a “Daily Cash Sheet” or “Batch Sheet” for the month that summarizes all of the payments processed in AVR for the previous billing cycle via email from an Inframark representative. The report lists payments by date and payment type only, but the totals agree to the AVR reports for the previous billing cycle. Using these two reports, s/he determines the transactions that posted to either the bank account or AVR but not both and completes a reconciliation identifying the reconciling differences between the two. After adjusting for outstanding items, the balance in the Wells Fargo Lockbox account should agree to the ending balance of undistributed overpayments per the AVR End of Month Recap, since the undistributed overpayments should be retained in the lockbox account until they are ultimately distributed to the various categories of collections (i.e. garbage, water operating, water debt, sewer operating, etc.).
Item 8.4
Mountain House Page 822 of 984 Local Assistance Procedures Manual Chapter 10
Consultant Selection
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Chapter 10 Consultant Selection
Contents
10.1 FEDERALLY-FUNDED A&E CONTRACTS ............................................................... 1
10.1.1 General ...................................................................................................................... 1 Introduction ............................................................................................................... 1 Definition of an Architectural and Engineering Consultant ........................................ 1 Architectural and Engineering Consultants ............................................................... 1 Non-A&E Consultants ............................................................................................... 2 Selecting the Project ................................................................................................. 2 Subcontracted Services ............................................................................................ 2 Organizational and Consultant Conflicts of Interest .................................................. 2 Consultants Performing Work on Multiple Phases of Federal-aid Projects ............... 3 Miscellaneous Considerations Authorization to Proceed........................................... 4
10.1.2 Identifying & Defining a Need for Consultants............................................................ 4 Designate Contract Administrator ............................................................................. 4 Segmenting Consultant Work.................................................................................... 5 Specify Products to be Delivered .............................................................................. 6 Scope of Consultant Work......................................................................................... 6 Title VI Assurances ................................................................................................... 6 Non-Discrimination Clause........................................................................................ 6 Disadvantaged Business Enterprise (DBE) Participation .......................................... 7 Estimated Cost of Consultant Work .......................................................................... 7 Determine Type of Contract ...................................................................................... 8 Determining the Project Schedule...........................................................................10 Determine Method of Payment................................................................................11 Cost-Plus-Fixed Fee................................................................................................11 Cost Per Unit of Work..............................................................................................11 Specific Rates of Compensation .............................................................................12 Lump Sum...............................................................................................................12 Changes to Cost Proposal ......................................................................................12
10.1.3 A&E Consultant Audit and Review Process .............................................................13 Applicable Standards ..............................................................................................13 Audit Guidance Available ........................................................................................13 Allowable Costs.......................................................................................................14 Safe Harbor Rate ....................................................................................................14 Approval or Acceptance of Indirect Cost Rates.......................................................15 EXHIBIT 1
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Cognizant Letters of Approval.................................................................................15 Caltrans Acceptance of Indirect Cost Rate..............................................................16 Financial Review Performed Prior to Contract Execution........................................16 Local Public Agency Responsibilities ......................................................................17 Consultant Responsibilities (both prime consultants and subconsultants) ..............18 Independent Office of Audits and Investigations’ Responsibilities...........................19 Audits and Reviews to be Performed ......................................................................19 Indirect Cost Rate Audits.........................................................................................19 CPA Workpaper Reviews........................................................................................19 Contract Audits........................................................................................................20 Incurred Cost Audits................................................................................................20 Audit Findings and Review Deficiencies..................................................................20
10.1.4 Consultant Selection Methods..................................................................................21 One-Step RFP.........................................................................................................21 One-Step RFQ ........................................................................................................21 Two-Step (RFQ Followed by RFP)..........................................................................21
10.1.5 Consultant Selection Using the One-Step RFP Method...........................................22 Appoint Consultant Selection Committee................................................................22 Develop Technical Criteria for Evaluation of Proposals...........................................22 Develop Schedule for Consultant Selection ............................................................22 Prepare RFP ...........................................................................................................23 Financial Management and Accounting System Requirements ..............................24 Advertise for Consultants ........................................................................................24 Conduct Proposer’s Conference or Answer Written Questions...............................24 Receive and Evaluate Technical Proposals ............................................................25 Develop Final Ranking and Notify Consultants of Results ......................................25 Negotiate Contract with Top-Ranked Consultant ....................................................26 Initiate A&E Consultant Audit Process (Financial Document Review Request) ......26
10.1.6 Consultant Selection Using the One-Step RFQ Method...........................................27 Appoint Consultant Selection Committee................................................................27 Develop Technical Criteria for Evaluation of Qualifications.....................................27 Develop Schedule for Consultant Selection ............................................................28 Prepare RFQ...........................................................................................................28 Financial Management and Accounting System Requirements ..............................29 Advertise for Consultants ........................................................................................29 Issue/Publish RFQ ..................................................................................................30 Receive/Evaluate Statements of Qualifications and Develop Short List..................30 Notify Consultants of Short List ...............................................................................30 EXHIBIT 1
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Interview Top-Ranked Consultants .........................................................................30 Develop Final Ranking and Notify Consultants of Results ......................................31 Conduct Scoping Meeting .......................................................................................31 Request Cost Proposal ...........................................................................................31 Negotiate Contract with Top-Ranked Consultant ....................................................32 Initiate A&E Consultant Audit Process (Financial Document Review Request) ......33
10.1.7 Consultant Selection Using the Two-Step RFQ/RFP Method ..................................33 Combined RFQ and RFP ........................................................................................33 Categorize Work .....................................................................................................34 Establish Minimum Qualifications............................................................................35 Issue RFQ...............................................................................................................35 Set-Up Evaluation Process .....................................................................................36 Evaluate Qualifications and Add Firm to List...........................................................37 Maintain List ............................................................................................................37 Issue RFP to Short-Listed Consultants ...................................................................37 Conduct Proposer’s Conference or Answer Written Questions...............................38 Receive and Evaluate Technical Proposals ............................................................38 Develop Final Ranking and Notify Consultants of Results ......................................38 Request Cost Proposal and Negotiate Contract with Top-Ranked Consultant........39 Initiate A&E Consultant Audit Process (Financial Document Review Request) ......39
10.1.8 Completing the Project .............................................................................................40 Develop the Final Contract......................................................................................40 Review and Approval of Contracts ..........................................................................40 Execute Contract and Issue Notice to Proceed to Consultant................................. 41 Administer the Contract...........................................................................................41 Substitution of Consultant Personnel and Subconsultants......................................42 Invoicing (or Progress Payments) ...........................................................................42 Contract Amendments.............................................................................................43 Performance Evaluation..........................................................................................44 Project Records.......................................................................................................44 Retention Clauses...................................................................................................45 Review of Local Public Agency Actions...................................................................45
10.1.9 Miscellaneous Considerations..................................................................................46 Agreements with Other Governmental Agencies ....................................................46 Small Purchase Contracts.......................................................................................46 Noncompetitive Negotiated Contracts (Sole-Source)..............................................46 Retaining a Consultant in a Management Support (CMSR) Role............................47 Construction Engineering Services .........................................................................50 EXHIBIT 1
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10.1.10 Program Management............................................................................................50
10.1.11 References.............................................................................................................51
10.2 STATE-ONLY FUNDED A&E CONTRACTS.............................................................53
10.2.1 General ....................................................................................................................53
10.2.2 Definition of A&E ......................................................................................................53
10.2.3 Minimum Audit Requirements ..................................................................................54 A. Written Procedures .............................................................................................54 B. Conflict of Interest...............................................................................................54 C. Records ..............................................................................................................54 D. Full & Open Competition.....................................................................................54 E. Selection Basis ...................................................................................................54 F. Publication ..........................................................................................................54 G. Solicitation ..........................................................................................................54 H. Cost Comparison................................................................................................54 I. Negotiations .........................................................................................................55 J. Audit and Review Process...................................................................................55 K. A&E Consultant Contract Form...........................................................................55
10.2.4 References...............................................................................................................55
10.3 NON-A&E CONTRACTS ...........................................................................................57 Scope......................................................................................................................57 Determining Non-A&E.............................................................................................57 Example of Determining Non-A&E..........................................................................57 Intelligent Transportation System (ITS) Projects .....................................................58 Non-Infrastructure Projects .....................................................................................58 Governing Regulations and Codes for Non-A&E ....................................................59 Procurement of Non-A&E Consultant Contracts .....................................................59 RFP Basic Requirements ........................................................................................59 Additional Requirements and Evaluation Criteria ....................................................60 Consultant’s Proposal .............................................................................................60 Cost Proposal Worksheet........................................................................................61 DBE Consideration..................................................................................................61 Administrative Requirements ..................................................................................61 Oral Presentations Optional ....................................................................................62 Cost-Effective / Public Interest Finding....................................................................62 Protest / Appeals / Reinstatement Procedures........................................................62
10.4 A&E OVERSIGHT PROGRAM AND PROCESS REVIEW........................................63 General ...................................................................................................................63 Type of Reviews......................................................................................................63 EXHIBIT 1
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A&E Consultant Contract Form Review ..................................................................63 Review Findings and Deficiencies...........................................................................64 Sanctions ................................................................................................................65 Exhibits
Exhibit 10-B: Suggested Consultant Evaluation Sheet
Exhibit 10-G: Individual A&E Task Order DBE Tracking Sheet Exhibit 10-I: Notice to Proposers DBE Information
Exhibit 10-O1: Consultant Proposal DBE Commitment
Exhibit 10-O2: Consultant Contract DBE Commitment
Exhibit 10-Q: Disclosure of Lobbying Activities
Exhibit 10-R: A&E Boiler Plate Agreement Language
Exhibit 10-S: Consultant Performance Evaluation
Exhibit 10-T: Conflict of Interest & Confidentiality Statement Exhibit 10-U: Consultant in Management Support Role Conflict of Interest and Confidentiality Statement
All LAPM Exhibits are located at:
https://dot.ca.gov/programs/local-assistance/forms/local-assistance-procedures-manual-forms EXHIBIT 1
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Consultant Selection